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Ukraine to Sue Russia’s Gazprom

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Ukrainian authorities have decided to launch a lawsuit against Russian energy giant Gazprom, acting Ukrainian Prime Minister Arseny Yatseniuk told reporters Monday.

KIEV, April 28 (RIA Novosti) – Ukrainian authorities have decided to launch a lawsuit against Russian energy giant Gazprom, acting Ukrainian Prime Minister Arseny Yatseniuk told reporters Monday.

“The Ukrainian government and state-run gas company Naftogaz took the decision to launch the procedures to sue the Russian company Gazprom. Today a pre-arbitration note was sent to the Russian monopolist. Over 30 days, and in accordance with the terms of the contract, the Russian monopolist needs to give a clear answer to the following issues, and first of all the issue of the price,” Yatsenyuk said.

He added that Ukraine is ready to immediately pay its $2.2 billion debt to Gazprom if it returns the price on the gas to its level of the first quarter of this year, $268 per thousand cubic meters.

Russia has been fostering Ukraine’s economy through natural gas deliveries since Ukraine emerged as an independent state in 1991. Under a number of agreements between the two countries, Ukraine received unprecedented privileges and discounts on the price of Russian natural gas. Over the period 2009-2014, Russia has supplied Ukraine with 147.2 billion cubic meters of gas.

In 2010 Russia and Ukraine signed an agreement that secured Ukraine a $100 discount for Russian gas in return for granting Russia the right to use the Sevastopol port to host its navy fleet.

In December, Russia agreed to cut the price to $268.50 per thousand cubic meters of gas from around $400. The deal stipulated a quarterly revision of the price. Russia also offered Ukraine $15 billion in loans.

Both measures were scrapped earlier this month, putting the gas price for Ukraine at $485.50 per thousand cubic meters.

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