Ukrainian Gas Talks Called Off

Naftogaz Ukrainy, Ukraine's state energy company, cut short talks about natural gas sales and debt, said RosUkrEnergo, the country's exclusive supplier of the fuel.

Andrei Knutov, a spokesman for the gas trader, said Friday after the negotiations in Kiev that RosUkrEnergo was concerned by Naftogaz's "refusal to conduct a civilized dialogue."

Natural gas export monopoly Gazprom, which owns half of RosUkrEnergo, also attended the talks, as did UkrGazEnergo, a Ukrainian gas retailer, Knutov said. Ukraine owes $598 million for fuel deliveries, he said.

Ukrainian Prime Minister Yulia Tymoshenko is looking to scrap a December gas-price agreement, raise transit fees for Russian gas exports to Europe and buy fuel directly from Gazprom. RosUkrEnergo was set up to help resolve a dispute during which Gazprom shut off gas supplies to Ukraine in the first three days of 2006.

Russia, which supplies one-quarter of Europe's gas, primarily through Ukrainian pipelines, agreed to increase the transit fee it pays its neighbor by 6.25 percent to $1.70 per 1,000 cubic meters for every 100 kilometers traveled under a Dec. 4 agreement. Tymoshenko became prime minister two weeks later.

Gazprom raised the gas price for Ukraine by 38 percent to $179.50 per 1,000 cubic meters of gas under that deal.

Naftogaz spokesman Dmytro Marunich declined to comment when reached on his cell phone Friday.