A new attempt: Ukrainian consortium to keep Europe supplied with gas

Last Tuesday Ukraine took a new look at the gas crisis, suggesting for the first time that it could provide energy security not only for itself but all of Europe. Vladyslav Kaskiv, adviser to the President of Ukraine, and Pawel Ponciliusz, Deputy Minister of Economics of Poland and member of the Polish Sejm, have called for establishing a Euro-Ukrainian gas transportation consortium.

According to Kaskiv, a leader of the PORA-PRP bloc that demanded that the gas deal signed on Jan. 4 in Moscow be denounced, the creation of a Polish-Ukrainian and then a Euro-Ukrainian consortium requires revising the Moscow agreements as well as those with Rosukrenergo. “The Euro-Ukrainian gas transportation consortium is a joint Ukrainian- Polish initiative that will allow Ukraine to guarantee its independence from Russian energy resources and will provide energy security for Europe. Besides, with this kind of approach, Ukraine does not need to accept Russia’s conditions. Establishing a Euro-Ukrainian gas transportation consortium is a revolutionary step toward solving Ukrainian and European energy problems. We are sure that this will trigger a new debate on Ukraine and the European Union’s energy security, help protect Ukraine from economic and political pressure, and attract additional investments. Setting up this consortium is the most important and practicable way for Ukraine to integrate into Europe and protect our energy security,” Kaskiv said.

Ponciliusz shares his opinion. “What happened to Ukraine and hence to Europe in January 2006 was a complete shock not only for Poland but all of Europe,” he said. The dangerous situation around the supply of Russian gas to Europe was in turn a catalyst for searching for alternative fuel sources. The Polish deputy minister is convinced that the creation of a Polish-Ukrainian and Euro-Ukrainian gas transportation consortium is the most fitting mechanism for such diversification.

“For both sides, Poland and Ukraine, this approach is the only opportunity to ensure joint security,” Polnciliusz says. He also maintains that using the Odesa-Brody oil pipeline in the projected direction will further guarantee energy security, as it will make it possible to extend the pipeline westwards. “Poland’s task is to find investors who will have the line laid as far as Gdansk.”

However, Ponciliusz has some reservations that we don’t quite understand. “If the agreements lack transparency and clarity, Poland will find it very difficult to cooperate with Ukraine in this matter,” he said.

Kaskiv also has some apprehensions over the implementation of the consortium idea. Declaring that the initiative to set up a Euro-Ukrainian gas transit consortium may have more than one development vector and require international debate and consultations with commercial partners, he stressed that this project could only be launched if “Ukraine demonstrates political will and puts its national interests above the personal benefit of some vested interests.”

This is a transparent allusion to those who are slowing down the resolution of gas problems. What are we going to hear in reply? Will our country know the Ukrainian participants in Rosukrenrgo or will they conceal themselves again, like the Antimonopoly Committee did, beneath a veil of secrecy? Kaskiv believes this will be a job for the new Ukrainian parliament and an indicator of the extent to which the newly-elected Verkhovna Rada will be ready to defend the country’s national interests.

Meanwhile, it is possible that the gas issue will be one of the main thorns in the side of the new parliament. Last Tuesday Ukraine heard a sensational statement from Gurbanmurad Atayev, Minister for the Oil and Gas Industry and Mineral Resources of Turkmenistan.

“The Turkmen side is not responsible for deliveries of its natural gas to Ukraine because Kyiv has not reached an agreement with Russia on the transit of Turkmen natural gas,” Atayev said in response to the publicized claim of Ivan Plachkov, Minister for Fuel and Energy of Ukraine, that Turkmenistan is not meeting its gas supply obligations. This is why the two sides have not begun to implement the December 2005 contract on supplying 40 billion cubic meters of gas to Ukraine.

“The Turkmen side has suggested officially several times that the Ukrainian side make a deal with Russia’s Gazprom on the transit of Turkmen natural gas through its territory,” the Turkmen minister said. This raises another question for Ukraine’s leaders, who have repeatedly said that everything is fine with Turkmen gas.