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. Last Updated: 07/27/2016

Kiev Delays Signing Gas Deal

bloombergA Transgas pumping station in Boyarka, Ukraine, earlier this month.
KIEV -- Ukraine has delayed signing a new contract to buy Russian gas, pending final agreement of terms including pricing, because of the Ukrainian parliament's attempts to scuttle the deal, the country's prime minister said on Saturday.

Prime Minister Yuriy Yekhanurov said Ukraine would aim to sign the deal with Russian gas giant Gazprom next Wednesday. Agreed to on Jan. 4 following a standoff with Moscow that saw supplies suspended, the accord will almost double the price of gas.

"Unfortunately, we were unable to get the documents ready. ... The first question is the price of gas: how prices are established and how long they are to remain in place," Yekhanurov said in comments broadcast on Ukrainian television.

He said the government also needed to determine whether ministers were in a position to sign the deal after being dismissed by parliament.

Clinched in the heat of a parliamentary election campaign, the gas contract was denounced as a betrayal of national interests by Ukrainian President Viktor Yushchenko's rivals.

The parliament sacked the Cabinet within days, plunging Ukraine into constitutional deadlock, with Yushchenko insisting his government would remain in place until March's election.

A further resolution this week demanded a new agreement and dismissed ministers and officials linked to the original deal.

"A legal opinion is needed on a lot of issues. When will this resolution be published, and what will it look like?" Yekhanurov said on Channel 5.

"At issue here is the competence of both sides. Who can sign the deal? Who isn't empowered? Will there be consequences?"

Yushchenko has said nothing about the parliament's latest move. An official in his administration said on Friday that the president would soon act within the constitution to resolve the situation.

The gas accord ended a disagreement between Moscow and Kiev that culminated in Gazprom briefly switching off supplies to Ukraine. The dispute also saw 80 percent of deliveries to Europe halted. Europe gets around one-quarter of its gas from Russia.

Investors have criticized Gazprom and its Ukrainian counterpart, Naftogaz Ukrainy, for using intermediary Rosukrenergo to supply gas, saying the group has a dubious structure.

Yekhanurov acknowledged on Saturday that more explanation was needed on the structure and role of Rosukrenergo.

He also said Ukrainian Fuel and Energy Minister Ivan Plachkov, one of the officials dismissed by the parliament, would hold talks in Moscow on Sunday with Saparmurat Niyazov, the president of Turkmenistan.

Ukraine signed a separate deal just before New Year with Turkmenistan, its second gas supplier, to buy gas at $50 per 1,000 cubic meters.

 Naftogaz Ukrainy and Rosukrenergo failed to set up a joint venture to market natural gas from Russia, three weeks after a gas dispute curtailed supplies to western Europe, Bloomberg reported.

A final agreement on the venture, originally scheduled to be announced today, was delayed until Jan. 25, Ukrainian Prime Minister Yuriy Yekhanurov said at a press conference today in Kiev, Ukraine's capital.