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Ukraine complains no help from Europe in Russia gas rows

Source: Thomson Reuters Foundation - Wed, 6 Feb 2013 17:20 GMT
Author: Reuters
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* Yanukovich says Europe gave no support over ${esc.dollar}7 bln Russia bill

* Ukraine's ties with EU are strained over Tymoshenko affair

By Andrius and Sytas

VILNIUS, Feb 6 (Reuters) - Ukraine complained on Wednesday that it had received little or no support from European countries in its face-off with Russia over the price of its gas imports and a ${esc.dollar}7 billion Russian bill.

The dispute between Russia, the former Soviet republic's major energy supplier, dramatically escalated last month when Russia's gas giant Gazprom sent the bill to Kiev to cover gas it says Ukraine was contracted to buy last year but never took.

Though Ukraine's ties with the European Union are equally strained, President Viktor Yanukovich indicated on Wednesday he had all the same been seeking support from Europe in the confrontation with Russia.

Ukraine relies heavily on Russian gas to heat homes and fuel the industrial sector. But Kiev says the current gas supply deal thrashed out in 2009 sets an exorbitant price for the fuel at ${esc.dollar}430 per thousand cubic metres in the current quarter.

The Kiev government, in months of negotiations, has failed to persuade Moscow to lower the price. Russia has said that a price reduction is only on the cards if Ukraine joins a Russia-led Customs Union or relinquishes control of its gas pipeline network system.

Gas pricing disputes between Kiev and Moscow came to world attention in January 2006, when supplies to western European customers were halted. A dispute over gas prices - Ukraine then paid just ${esc.dollar}50 per 1,000 cubic metres and Russia's Gazprom wanted to charge ${esc.dollar}230 - was complicated by accusations of corruption in the energy sector from then Prime Minister Yulia Tymoshenko.

"In the past three years we have had no support, even sympathy in the issues of the gas force majeure relations Ukraine has had," Yanukovich told a news conference after meeting Lithuanian President Dalia Grybauskaite.

"When Russia presented us with a bill of ${esc.dollar}7 billion in penalties we hoped that we would get some comments on this from the European Energy Community," he added, referring to a cooperation body for EU and neighbour non-EU states.

"We repeatedly sent letters about this to the European Energy Community. Not once did we get a reply and this is a problem," he said.

Ukraine and the 27-member bloc have initialled a blueprint for political association and free trade to set Ukraine on course for integration into the European mainstream.

But the EU is at odds with Yanukovich over the imprisonment of opposition leader Yulia Tymoshenko and is refusing to take relations further and sign the agreement.

Tymoshenko is serving a seven-year jail sentence for abuse-of-office meted out in October 2011 after a trial which the West said smacked of selective justice by the Yanukovich leadership.

The EU and Ukraine are due to hold a summit on Feb. 25 when Kiev wants to resurrect the deals which have been put onto the back burner. (Reporting by Andrius Sytas; writing by Patrick Lannin and Richard Balmforth; editing by Keiron Henderson)

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