Kyiv cannot but look for Moscow’s reaction
A number of Ukrainian- Turkmen documents were signed in Kyiv on May 13, including an agreement on 2002-06 natural gas supplies from Turkmenistan. President Saparmurad Niyazov said after the signing ceremony that his country will deliver 250 billion cubic meters of gas to Ukraine over the next five years (50 billion cu. m in 2003, “and growing quantities until 2006.”
In Mr. Niyazov’s words, Turkmenistan will supply 40 billion cu. m. in 2002 under the agreement, at $42 per 1,000 cu. m (30 billion has been delivered in 2001), and Ukraine will make 50:50 pro rata payments in hard currency and in terms of investment policy. The Turkmenistan president explained that this policy provides for investment projects in Turkmenistan worth a total of $412 million.
As for the settlement of Ukraine’s gas debts to Turkmenistan, Pres. Niyazov noted that his country “will not force the process [i.e., payment],” adding that Ukrainian payments depend on the results of talks with the Paris Club and that Turkmenistan is prepared to “wait until the problem between Ukraine and the Paris Club is settled... Ukraine still needs time, two or three months, and this costs nothing.” The Turkmenistan president estimates Ukraine’s current liabilities at “$415-420 million, including $40 mil worth of goods.”
Mr. Niyazov believes that Ukraine and Turkmenistan should establish lasting cooperation which he describes as “strategic and mutually advantageous.” He pointed out that the gas supply agreement will secure Turkmenistan “stable gas sales, including the Ukrainian market... We are prepared to work out, sometime in 2003-04, and sign a gas supply agreement for another ten years.”
Pres. Leonid Kuchma believes the gas agreement with Turkmenistan will allow Ukraine to considerably diversify its gas supply sources, and this will “practically supply all of Ukraine’s gas demands.” When asked how the newly signed agreement will lessen Ukraine’s dependence on Russia for gas supplies, Mr. Kuchma replied, “I wouldn’t put the question that way,” adding that “Ukraine and Russia depend on each other because Europe’s principal pipeline runs through Ukraine.”
Russia is closely following the Ukrainian-Turkmenistan talks. When asked by The Day whether Russia will pay Ukraine money for gas transit, Gazprom’s press service explained, “It’s not as simple as you think,” and suggested an analysis of Ukrainian- Turkmenistan relations, stressing that “they have never been easy.” Moreover, they said we should not delude ourselves that Ukraine would do without Russian gas, even on account of gas transit. They also recalled that Turkmenistan gas also passes across Russia. As for payments for gas transit, we were told, “We would have long ago started paying hard cash if the arrangement had been acceptable.” And yes, it would benefit Russia if Ukraine paid Turkmenistan in full and on time, because gas from Turkmenistan would go through Russia and there would be transit charges to pay.
