Ukraine to pay Russia $3.1 bln in total for gas by year's end - Oettinger on Ukraine-Russia gas talks outcome

The European Union, Ukraine and Russia have reached preliminary agreement on securing gas supplies this winter.

"We have agreed the important key points of the 'winter package.' We believe that there may be a tangible solution to ensuring reliable gas shipments in winter," EU Energy Commissioner Gunther Oettinger said at a briefing after a meeting with Russian Energy Minister Alexander Novak and Ukrainian Energy and Coal Industry Minister Yuriy Prodan on Friday in Berlin.

The Commissioner noted that under the preliminary agreements reached, Ukraine should transfer $2 billion to Russia's OAO Gazprom by the end of October as payment for previously delivered gas, and another $1.1 billion by the end of the year. The European Commission will ask the International Monetary Fund to provide necessary guarantees to Ukraine.

The Commissioner also noted that since NJSC Naftogaz Ukrainy and Gazprom had previously appealed to the Stockholm arbitration to resolve a dispute about the price of gas supplied, then if the Stockholm Arbitration agrees with Ukrainian arguments that the price for gas supplied in November-December 2013 and from April to June 2014 should be $285 per 1,000 cubic meters, it would mean that Ukraine has fully repaid its debts for Russian gas.

In the event that the court takes Russia's side, Ukraine will have to pay another $2 billion.

Oettinger also noted that in the coming days the parties must consult with their governments so that the achieved agreements be formalized in a binding protocol next week if there is no objection.

"By the end of next week we can have a binding protocol," Oettinger said.

As reported, the EU, Ukraine and Russia have been holding tripartite talks on gas supplies to Ukraine since the beginning of May 2014.