Ukraine, Russia reach gas transit agreement 'in principle'

Ukraine and Russia have reached an agreement on natural gas transit from early January "in principle", Vice-President of the European Commission Maros Sefcovic said following the trilateral talks in Berlin on December 19.

"We have reached an agreement in principle on all key elements," news agency Interfax quoted him as saying . "The agreement in principle, which we reached, will be discussed in the capitals tomorrow," he said.

According to him, this is "positive news for Europe, for Russia, for Ukraine." Earlier this year, Ukraine's state-owned natural gas monopoly Naftogaz said that it will be cut off by Russia's Gazprom from gas transit shipments via Ukraine from January 1 as its base-case scenario. The statement followed a meeting in Brussels with Gazprom, which failed to start talks on a new contract for gas transit through the Ukrainian gas transmission system.

This deal comes after a false dawn of reports that a preliminary deal had been agreed in Vienna a week earlier. That was followed by reports that the chance of a deal was “close to zero” earlier this week.

Kyiv believes that Russia will suspend deliveries of gas, including the transit gas to Russia’s European customers via Ukraine, on January 1, 2020, when the current contract for gas transit to Europe between Russia's Gazprom and Ukraine expires. More than a third of Europe's gas comes from Russia, and most of that goes through Ukraine's pipelines.

Meanwhile, Ukrainian Minister of Energy and Environmental Protection Oleksiy Orzhel said on December 19 that Ukraine, Russia and the European Commission drawn up a protocol that brings them closer to the signing of a gas transit contract.

"We've done a good job today, we've worked very well on the final protocol of the solution that brings us closer to the signing of the final agreements," he said, adding that the results must be endorsed by the political leadership in Kyiv and Moscow. "In the near future, I am sure, we will achieve positive results for all the parties." Later, Russian gas monopoly Gazprom said that the talks with Ukraine will continue in Minsk on December 20. "The negotiations are not technical. The level is high. Gazprom to be represented by CEO Alexei Miller," the company's unnamed representative told Russian reporters.

At the same time, Russian Energy Minister Alexander Novak said on December 19 that "we really did a very good job today, prepared a draft protocol, a detailed protocol that is almost ready, which currently needs to be agreed upon, and I hope that we will come to final agreements in the near future".

The Berlin negotiations followed a statement made by CEO of Ukraine's natural gas monopoly Naftogaz Andriy Kobolev that the probability of signing a contract for the transit of natural gas with Russia's Gazprom from January 1 "is nearing zero".

"We can say that there is still some chance of signing a transit contract from January 1, but it's very, very small. Every minute it is nearing zero," he said.