* European Commission reiterates call for Russia to respect
* Rejects criticism that EU to blame for Ukraine economic
* Kiev says three separatists killed in east Ukraine
(Adds quotes, context)
By Barbara Lewis
BRUSSELS, April 17 The European Union told
Russian President Vladimir Putin it is willing to hold talks
with Moscow and Kiev on gas security as the bloc scrambles to
defuse a deep political crisis over Russia's annexation of
European Commission President Jose Manuel Barroso, replying
to a letter Putin sent last week to 18 EU countries, accepted
Putin's proposal for three-way talks.
"The European Union agrees on your proposal for
consultations with the Russian Federation and Ukraine with
regard to security of gas supply and transit," Barroso said in
his reply, released by the European Commission on Thursday.
Putin warned EU leaders a week ago that Russia would cut
natural gas supplies to Ukraine if it did not pay its more than
$2 billion gas debt and said this could lead to a reduction of
onward deliveries to Europe.
The EU has voiced outrage over Moscow's annexation of
Ukraine's Crimea region and is extremely nervous about the
energy implications of the conflict as Ukraine is a major
transit route for Russian gas.
Russia provides Europe with roughly one third of its gas
imports, some 40 percent of which flow via Ukraine, and delivers
around half of Ukraine's domestic gas needs.
The transit nation's instability worsened on Thursday as
Kiev reported three separatists had been killed in east Ukraine,
overshadowing talks between Ukrainian, Russian and Western
diplomats in Geneva to try to resolve the conflict.
WHO WILL PAY?
Some analysts say the only way for Europe to take the heat
out of the crisis is for the EU to pay Ukraine's gas bills, but
that is opposed by many in the bloc on the grounds it would be a
direct payment to Russia, which has flouted international law.
Barroso said Ukraine's gas debts and import prices should be
considered as part of a wider aid package between the EU and the
International Monetary Fund.
He also said Europe was already providing support to Ukraine
and rebuffed Putin's criticism the EU was to blame for Ukraine's
economic and political crisis.
Earlier this month Russian gas giant Gazprom
increased gas prices for Ukrainian consumers to $485 per 1,000
cubic metres from $268, prompting Ukraine's new authorities to
say the rise was politically motivated and to refuse to pay.
Barroso's reply to Putin said "changes to contractual
arrangements due to political circumstances run counter to the
spirit of support and cooperation enshrined in your letter".
He also reiterated his wider call on Russia to respect gas
contracts and said it had a duty to warn Europe before taking
"any unilateral steps", such as halting supplies.
Gas supplies to the EU were disrupted in 2006 and 2009 as a
result of pricing spats between Russia and Ukraine.
In response, Europe has sought to improve its energy
security through improved infrastructure and requirements on
member states to keep gas in storage, but it remains heavily
dependent on Russian supplies.
Russia meanwhile has sought to diversify its energy shipment
It has already built the Nord Stream pipeline to carry
Russian gas directly to Germany and is now working on the South
Stream route from Russia via the Black Sea to Bulgaria.
The European Commission says South Stream is in breach of EU
law and has instead placed the emphasis on modernising Ukraine's
energy transit infrastructure.
(Additional reporting by Adrian Croft in Brussels and Vladimir
Soldatkin in Moscow, editing by David Evans)