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. Last Updated: 07/27/2016

Gazprom, Citing Debt, Plans Gas Cut to Ukraine

MOSCOW -- The gas company Gazprom plans to halt deliveries to Ukraine on Thursday, but Russian gas supplies to Western countries should not suffer significantly as a result, a senior Gazprom official said Wednesday.


Gazprom said Tuesday it would cut off gas to Ukraine unless Kiev took steps to pay a debt of about 1.5 trillion rubles ($900 million) for previous deliveries.


Gazprom chief engineer Vladimir Podmarkov warned Wednesday that if Ukraine siphoned gas from pipelines leading to big Western consumers such as Germany, Italy and France, these could also be shut down.


"Everything will depend on the position of Ukraine," he said, adding that Ukraine was already taking as much as 40 million cubic meters a day from supplies meant for the West.


"If they consume gas destined for Western buyers, then Western countries will be deprived of Russian gas," he said. "But I don't think this will happen."


Podmarkov said Ukraine would come under heavy pressure from the West if it continued to siphon from the export pipelines. "If we see that this (siphoning) is happening, we will cut off these deliveries," he said. "Ukraine will all the same be without gas."


Russia exports about 100 billion cubic meters of gas a year, with more than 90 percent of it crossing Ukraine.


However, the Gazprom official said there could be reductions in deliveries to the West as a result of the planned cut-off to Ukraine. "Perhaps there will be some initial reductions from 250 million cubic meters a day to maybe 220 million, but no more than that," he said.


Gazprom, which has a virtual monopoly over the Russian gas industry, is currently pumping about 500 million cubic meters a day to Ukraine, about half of which is consumed by the former Soviet republic and half of which goes to western Europe.


Podmarkov said supplies to Ukraine would be reduced gradually if "decisive steps" were not taken to pay debts.


"During a three-day period, we could reduce supplies from about 500 million to 250 million (the Western element) -- 50 million the first day, 100 million the second day and 100 million the third day," he said. "We want to punish Ukraine only."


In Kiev on Tuesday, a Ukrainian gas industry official doubted Gazprom would carry out its cut-off threat.


"Russia won't dare cut supplies completely," Bohdan Babiy, chief engineer at the transportation division of the Ukrhazprom company, said. "Previous experience shows that our enterprises would just take the gas for (Western) export from the pipeline," he said.


Gazprom has been delivering to Ukraine about twice as much gas as agreed since Turkmenistan, Kiev's other supplier, cut off supplies on Feb. 20, complaining about non-payments.


Stepan Yaloveha, spokesman for Ukraine's state committee on oil and gas, said Ukraine had enough gas in storage to last until April 15.