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EU Claims Right to Reverse Flow as Russia Protests

Published: July 4, 2014 (Issue # 1818)




  • Photo: Gazprom

EU Energy Commissioner Günther Oettinger on Thursday asserted European companies' right to sell Russian gas back to Ukraine, flying in the face of warnings from Russian energy giant Gazprom as tensions continue to build over energy policy.

Energy companies in the EU have an "absolute right to dispose of gas bought from Gazprom at their discretion, including delivering it in reverse to Ukraine," Oettinger said via his spokeswoman Sabina Berger, ITAR-Tass reported.

Moscow cut off gas supplies to Kiev in mid-June when Ukraine failed to meet a deadline to pay a $1.95 billion gas debt, despite extensive negotiations leading up to the deadline. Gazprom said Thursday that gas flows to the EU were continuing as normal, Reuters reported.

Gazprom head Alexei Miller said last week that the state-owned gas monopoly could retaliate against European countries if they were to sell its gas back to Ukraine through large-scale reverse gas flows.

"If we detect a reverse flow on gas-measuring stations in Europe, we may impose restrictions," Miller said, ITAR-Tass reported.

President Vladimir Putin supported Miller's position on Tuesday, although unlike Miller, Putin said that Ukraine was already taking gas intended for the EU. "In essence, [Ukraine] is getting our gas and they are paying one of our Western partners in Europe, who are not receiving these volumes," Putin said.

"We see everything, but are not taking any kind of action at the current moment so as not to aggravate the situation," he added.

Also on Thursday, Ukrainian gas company Naftogaz announced that 20 European companies, including the EU's largest gas traders, had bid to sell gas to Ukraine via Slovakia via so-called reverse flow.

"The extensive Ukrainian market is very interesting for Europeans," Naftogaz head Andrei Kobolev said, Prime reported.

In late April, Ukraine and Slovakia signed a reverse flow agreement that would make use of an old, unused pipeline to begin exporting 2 billion cubic meters, or bcm, to Kiev in October. Exports to Ukraine along this pipeline would rise to 8 bcm by early 2015.

Ukrainian energy officials have since proposed a plan to the EU Commission that would allow Ukraine to increase reverse flows via Slovakia to 30 bcm, Kommersant reported.

According to a UralSib report published Thursday, Gazprom would lose nearly $3 billion in 2016 if the EU accepted the proposal and began selling Russian gas back to Ukraine. The company would end up selling more gas to the EU — where prices range from $360 to $380 per thousand cubic meters and gas is subject to a 30 percent export duty — instead of Ukraine, where the price was previously set at $385 per thousand cubic meters, there is no export duty and transportation costs are lower.





 


ALL ABOUT TOWN

Wednesday, July 30


SPIBA continues their series of Look@It tours, which focus on the success stories of major brands in the St. Petersburg market. Today’s event will focus on the Gorky Golf Club and will also be held there. For more details visit spiba.ru



Thursday, July 31


Develop your leadership abilities during a lecture by famous Russian author and coach Radislav Gandapas. The event starts at 9 a.m. at 5 Lodeinopolskaya Ulitsa. The price for entry is 20,500 rubles ($570).


Relax and enjoy a Parisian atmosphere with some romantic and laidback jazz tunes during the Night of French Music at Lenny Jam Cafe, 63 Ligovsky Prospekt. The entrance fee is 250 rubles ($7).


The Women’s Business Club is hosting a Beauty Brunch where participants are invited to discuss the latest news in the beauty industry and listen to lectures by professional stylists in the business.



Friday, Aug. 1


Bikers from all around the world will gather to take part in a parade, extreme shows and rock concerts during the International Biker Festival that revs its engines today and runs through Aug. 3 near Olgino Hotel, 4/2 Primorskogo Shosse.


The Peter and Paul Fortress will be turned into an open-air cinema today and tomorrow as part of the 5th International Short and Animation Film Festival. A huge screen across the fortress walls will air short films non-stop with board games, photo sessions and other activities also on offer for visitors. For more information, visit www.opencinemafest.ru



Saturday, Aug. 2


Gatchina Palace Park Museum will host its second annual Night of Light, an impressive audio-visual show across the night sky. Tickets are 600 rubles ($16).


If graphic design is more your thing then check out Illustration Day, where you will be able to visit an exhibition, attend lectures by professionals and even show experts some of your own work. The event starts at noon at Zona Deystvia, 73 Ligovsky Prospekt. The entrance fee is 350 rubles ($10).



Sunday, Aug. 3


History lovers shouldn’t miss the chance to see reenactments of World War I battles in Pushkin at noon. Besides exciting war scenes, visitors can enjoy live music, historical costumes, an equestrian show and a fancy-dress parade starting from the Moscow gates.


Garage Sale, the popular and growing flea market where nothing is priced over 500 rubles ($14.11), starts today at noon in Loft-Project Etagi, 74 Ligovsky Prospekt. Be sure to get in early to score a bargain. Entry costs 50 rubles ($1.40)



Monday, Aug. 4


Continue the working week with a calm and steady mind with a free yoga lesson at 7 p.m. in the Bukvoed store at 23A Vladimirsky Prospekt.



Tuesday, Aug. 5


Visit The Romanov Dynasty doll exhibition today, where more than fifty porcelain dolls depicting Russian rulers, and made by Olina Ventzel, will be on show. The exhibition continues through Aug. 31 in Sheremetyev Palace, 34 Fontanka Naberezhnaya.



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