21st Oct 2016

Ukraine signs gas deal with Slovakia

  • Russia has almost doubled the price of gas in Ukraine (Photo: Naftogaz of Ukraine)

Slovakia is set to pump reserve natural gas to Ukraine in a reverse-flow deal signed on Monday (28 April).

The gas will run through the unused Vojany pipeline on the Slovakian side, managed by Slovak gas pipeline operator EUstream, to Uzhgorod in Ukraine.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

EUstream, along with its Ukraine counterpart Ukrtransgaz, aim to start pumping the gas sometime in autumn. The European Commission says it could amount to around 8 billion cubic metres (bcm) per year.

Despite around two years of negotiations, the move is in part framed by the escalating tensions between Russia and Ukraine.

Russia supplied 30 percent of gas to Europe last year, with a significant amount transited through Ukraine.

At the signing ceremony in the Slovak capital Bratislava, EU commission president Jose Barroso, described the deal as one that "contributes to greater energy security in Eastern Europe and the EU as a whole".

Around half of Ukraine's 50 bcm of gas consumed annually is sourced from Russia.

With Monday's agreement, Slovakia becomes the third and largest contributor of reverse-flow gas to Ukraine in the EU after Hungary and Poland.

"Gas via Slovakia will bring a considerable addition to the volumes that Ukraine can already import from Hungary and Poland," noted EU energy commissioner Gunther Oettinger.

Ukraine had stopped the Hungary and Poland imports after Russian state-controlled energy giant Gazprom slashed prices in December.

The cut was part of a larger $15 billion loan and a 33 percent discount on natural gas offered by Russia to Ukraine's Yanukovich-led government.

The discounted $270 per 1,000 cubic metres price has since almost doubled with flows now picking up again from Hungary and Poland.

Russia cancelled its 2010 Kharkov Agreement after it annexed Crimea.

The agreement had given Ukraine a gas rebate in exchange for hosting Russia's naval fleet in Sevastopol port. Moscow says the port is no longer a part of Ukraine.

Gazprom also issued an ultimatum for Kiev to pay $3.5 billion in unpaid bills by 7 May or risk getting cut off, sparking fears many in Ukraine may be without heating next winter.

Industry sources told Reuters last month that Ukraine has enough gas stored up to last at least four months should Gazprom stop the flows.

At 31 bcm, Ukraine has the largest gas storage capacity volume in Europe with most of the facilities found in the west of the country.

The EU is pushing to increase the volume of Slovak flows.

EUstream, for its part, has not completely ruled out upping the volume by using another larger transit gas pipeline but said it may run into legal problems.

The larger transit line carries Russian gas to the European Union and is partly managed by Gazprom Export.

The Slovak company, which describes itself as the largest single carrier of Russian gas in the European Union, said it would first have to reach an agreement with its Russian counterpart.

News in Brief

  1. Brexit could lead to 'some civil unrest' in Northern Ireland
  2. ECB holds rates and continues quantitive easing programme
  3. Support for Danish People's Party drops, poll
  4. Spain's highest court overturns Catalan ban on bullfighting
  5. Tusk: 'Concrete' migration proposals in December summit
  6. Commuters seek compensation for Swedish ID checks
  7. EU needs 'firmness and dialogue' with Russia
  8. Moment of truth is coming on Ceta, says Belgian PM

Stakeholders' Highlights

  1. UNICEFCalls on European Council to Address Plight of Refugee and Migrant Children
  2. ECTAJoin us on 9-10 November in Brussels and Discover the new EU Digital Landscape
  3. Access NowCan you Hear me now? Verizon’s Opportunity to Stand for Global Users
  4. Belgrade Security ForumMeaningful Dialogue Missing Not Only in the Balkans, but Throughout Europe
  5. EASPDJoin the Trip! 20 Years on the Road. Conference & Photo Exhibition on 19-21 October
  6. EuropecheEU Fishing Sector Celebrates Sustainably Sourced Seafood in EU Parliament
  7. World VisionWomen and Girls Urge EU Leadership to Help end Gender-based Violence
  8. Dialogue PlatformIs Jihadism Blind Spot of Western Intellectuals ? Wednesday 26 October
  9. Belgrade Security ForumGet the Latest News and Updates on the Belgrade Security Forum @BelSecForum
  10. Crowdsourcing Week EuropeMaster Crowdsourcing, Crowdfunding and Innovation! Conference 21 November - 10% Discount Code CSWEU16
  11. EJCEU Parliament's Roadmap for Relations with Iran a Massive Missed Opportunity
  12. Nordic Council of MinistersFish Skin on Bare Skin: Turning Fish Waste into Sustainable Fashion

Latest News

  1. Malta, Latvia, and Hungary top EU obesity charts
  2. British PM asserts her role in EU 'nest of doves'
  3. Italy shields Russia from EU sanctions threat
  4. EU and Wallonia still stuck on Canada accord
  5. Dieselgate isn't my fault, says German transport minister
  6. Scotland plans independence vote before Brexit
  7. EU threatens Russia over Syria 'atrocities'
  8. EU buries migration dispute for now