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Russia’s Gazprom Postpones Switch to Advance Payment for Ukraine to June 9

© RIA Novosti. Ilya Pitaliov
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Russian energy giant Gazprom had postponed the introduction of advance payment scheme for Ukraine until June 9 to give Kiev an opportunity to pay for the May gas deliveries, the company’s chief Alexei Miller said Monday.

MOSCOW, June 2 (RIA Novosti) – Russian energy giant Gazprom had postponed the introduction of advance payment scheme for Ukraine until June 9 to give Kiev an opportunity to pay for the May gas deliveries, the company’s chief Alexei Miller said Monday.

“Ukraine has made the first tranche of the gas supplies [payment]. Today Gazprom got 786 million on its account. We welcome Ukraine’s beginning of gas debt payments and reschedule the [start of] the advance payment scheme to June 9. The introduction of the prepayment scheme will depend on whether the debt for gas delivered before April 1, totaling 2.237 billion, is paid in full,” he said.

The May payment is also due before June 9, the Gazprom CEO added.

Earlier in the day the Russian Energy Ministry confirmed it had received $786.4 million from Ukraine as payment for gas deliveries in February and March.

Kiev announced that it made this payment to Russia on Friday evening after the gas talks between the EU, Russia and Ukraine in Berlin. The payment is 2.5 times smaller than the one the parties agreed on during previous talks.

Ukrainian Energy Minister Yuriy Prodan said that $786 million is the only undisputed part of the Kiev’s gas debt. It’s a payment for gas supplied to Ukraine at the price of 268.5 dollars per thousand cubic meters from January to March 2014, he explained.

The European Union, Russia and Ukraine will have another round of gas talks later on Monday.

In May Gazprom announced a switch to a prepayment scheme, in full accordance with the 2009 energy contract between Russian and Ukraine. Following the decision, an advance bill was sent to Naftogaz for June deliveries, with supplies to be suspended starting June 3 if the debt is not at least partly paid off.

The gas price for Ukraine surged from $268.5 to $485.50 per 1,000 cubic meters in April after Russia annulled two discounts granted previously to the country. Kiev keeps rejecting the new price saying it was ready to clear its debt if Moscow agreed to sell gas at the old price.

During the last trilateral energy meeting, Russia said it would only consider lowering the price of gas to Kiev if it begins paying off its gas debts. Naftogaz could transfer $2 billion by May 30 and another $500 million by June 7, which will cover unpaid gas bills from November to April, it was agreed on. Russian Energy Minister Aleksandr Novak said that Moscow will only move forward with talks as long as Kiev pays the first part of its debt by Friday.

Earlier this week EU Energy Commissioner Günther Oettinger said that Ukraine’s gas debt to Russia had reached $4 billion upgrading the previous figure of $3.5.

Simultaneously the Gazpom CEO announced that Ukraine would owe Russia about $5.2 billion for natural gas as of June 7 if it makes no payments by that date.

According to Gazprom, Ukraine’s Naftogaz halted all payments in November.

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gas, Gazprom
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