Wednesday, January 7, 2009

Gas stopped for swathe of states

Gas stopped for swathe of states

A Ukrainian worker checks gas containers at a depot near Kiev (06/01/2009)
Several countries are relying on their own limited reserves of gas

Seven European and Balkan countries have reported a complete halt in Russian gas supplies via Ukraine as the two countries' energy dispute worsens.

They join countries as far west as Italy and Austria suffering supply shortages since Russia halted its exports to Ukraine in a prices row.

Russia's Gazprom says Ukraine has been stealing gas in transit to Europe.

The EU depends on Russia for about a quarter of its total gas supplies, some 80% of which is pumped through Ukraine.

Bosnia-Hercegovina, Bulgaria, Croatia, Greece, Hungary, Macedonia and Serbia have now reported a total stoppage of gas deliveries from Russia.

Europe's gas pipeline network

Italy and Austria say they have received only 10% of their expected supply.

The row comes amid a cold snap across Europe that is likely to push up demand for gas.

Serbia says it is in a "critical" situation, while Slovakia says it will declare a state of emergency over the shortages.

Bulgaria says it has sufficient supplies for just a few more days. President Georgi Purvanov said the situation was grounds for restarting a nuclear reactor, shut as part of Bulgaria's accession to the EU in 2007.

Many other countries are now tapping strategic reserves, built up to cope with just such a development, says the BBC's Europe correspondent Nick Thorpe.

'Theft increasing'

Russia and Ukraine have been blaming each other for the disruption to Europe's energy supplies.

Gazprom has accused Ukraine of an "unprecedented" shutdown of transit pipelines. It says only 40m cubic metres of gas is getting through to Europe, instead of 225m cu m.

EU GAS IMPORTS FROM RUSSIA
100% dependent on Russia: Latvia, Slovakia, Finland, Estonia
More than 80% dependent: Bulgaria, Lithuania, Czech Republic
More than 60% dependent: Greece, Austria, Hungary
Source: European Council on Foreign Relations, 2006 figures

The chief executive of Gazprom, Alexei Miller, said Ukraine was stealing 15% of gas delivered across its borders and that theft was "increasing by the hour".

He said Russia would consider cutting gas supplied through Ukraine completely if none was getting through to central and western Europe.

Russian Prime Minister Vladimir Putin said the gas had been stolen "not from Russia but from western consumers because they have bought this commodity and paid for it".

Ukraine's Naftogaz said Russia had cut gas transit supplies by more than two-thirds and listed nine countries, including Germany, Poland, and Hungary, which would receive reduced supplies as a result.

Talks between Naftogaz and Gazprom aimed at resolving the crisis are due to resume in Moscow on Thursday - after the Christmas public holiday on Wednesday in Russia and Ukraine.

Gazprom has said it is surprised Ukraine is prepared to wait so long.

"Considering the crisis situation, we are ready to renew negotiations at any minute. Gazprom has been and will be a reliable gas supplier," said spokesman Sergei Kupriyanov.

Gazprom will also discuss the matter with the EU on the same day.

The European Commission has demanded that gas supplies to the EU are immediately restored.

'Gas stolen'

Russia stopped supplying gas to Ukraine on New Year's Day in a row about unpaid bills and the failure to agree a new pricing contract.

On Monday, Gazprom decided to cut exports through Ukrainian pipelines by a fifth to compensate for the amount it said Ukraine was siphoning off supplies intended for Europe for its own use.

Ukraine has denied stealing gas, saying technical problems are disrupting the onward flow of gas to Europe.

The new EU member states in central and eastern Europe are heavily - and in some cases entirely - dependent on Russian gas imports. Yet Germany and Italy together account for nearly half of the Russian gas consumed in the EU.

Gazprom has promised to pump extra supplies through other pipelines - the Yamal from Arctic Russia through Belarus to Germany, and the Blue Stream to Turkey under the Black Sea.

A similar row between Gazprom and Ukraine at the beginning of 2006 led to gas shortages in several EU countries.


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