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UPDATE 1-RWE says in talks with Ukraine on possible gas supplies
April 11, 2014 / 3:24 PM / in 4 years

UPDATE 1-RWE says in talks with Ukraine on possible gas supplies

* Talks held with Naftogas on shipments

* Framework deal allows delivery of up to 10 bcm/year

* No agreement reached yet

* If terms cleared, shipments could start very soon (Adds detail, context, Gazprom comment)

FRANKFURT, April 11 (Reuters) - German utility RWE said on Friday that it has discussed with Ukraine’s Naftogas possible gas deliveries to Ukraine in a move to help secure supply to the country.

The discussions between its subsidiary RWE Supply & Trading and Naftogas come as Russian gas exporter Gazprom warns it might cut supplies over Kiev’s refusal to pay prices Moscow now demands.

The price, timing and duration of possible deliveries would still have to be negotiated, RWE said in an e-mailed statement in response to a Reuters query.

If an agreement was reached, RWE was ready to “supply Naftogas of Ukraine with gas in reverse flow from its pan-European portfolio within a very few days,” it said.

Under a framework agreement signed between the two parties in May 2012 and lasting until May 2017, RWE could deliver up to 10 billion cubic metres (bcm) a year, it said.

Ukraine consumed around 55 bcm of gas last year.

Chief Financial Officer Bernhard Guenther said last month that RWE had options to deliver gas into Ukraine via Poland and Slovakia.

A Gazprom spokesman in Moscow said: “If it’s our gas, for which they have rights, then it’s fine. If these are machinations with the transit volumes we will investigate it.”

The European Union said it would help Ukraine after Russian President Vladimir Putin wrote to the EU warning supplies could be disrupted if Ukraine failed to cover its bills.

Russia has nearly doubled the price it charges Ukraine for gas, tearing up a discount agreed under ousted pro-Moscow President Viktor Yanukovich.

Gazprom says Ukraine owes $2.2 billion for gas it has received, rekindling fears of the “gas wars” of 2006 and 2009, when Russia stopped supplies to Ukraine, disrupting shipments to Europe. (Reporting by Kirsti Knolle, Vera Eckert, and Denis Pinchuk; editing by Marilyn Gerlach and Jason Neely)

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