November 28, 2012 / 2:20 PM / 5 years ago

Ukraine baffled as $1.1 bln gas deal unravels

* Confusion over Spaniard who signed deal with Ukraine government

* Spain’s Gas Natural says it has signed no deal in Ukraine

By Pavel Polityuk and Olzhas Auyezov

KIEV, Nov 28 (Reuters) - Ukrainian officials scrambled on Wednesday, two days after a vital $1.1 billion gas terminal deal unravelled, to establish whether a man they believed had signed for Spain’s Gas Natural actually represented the company.

Vladislav Kaskiv, the head of Ukraine’s state investment agency, signed the deal in Kiev in front of Prime Minister Mykola Azarov and the energy minister, with a man his agency initially identified as Gas Natural executive Jordi Garcia Tabernero.

The Spanish energy company quickly denied joining a consortium that would build a liquefied natural gas (LNG) terminal on Ukraine’s Black Sea coast, a project Ukraine hailed as reducing its dependence on pipeline gas from Russia.

Gas Natural also said Tabernero had not been in Ukraine at the time of the signing ceremony, a video of which was published on the government website.

Ukrainian officials, who insisted they had struck a genuine deal on Monday and stayed silent on Tuesday, said on Wednesday they were trying to figure out what had happened.

“This was most likely a result of gross negligence on the part of officials,” a source close to the government said.

Kaskiv, who according to the source looked shocked when he met officials the day after the signing, did not appear at a weekly cabinet meeting on Wednesday but issued a statement blaming the confusion on technical issues.

“I still hope that the (Gas Natural denial) published by the media was caused by technical hitches. We are now carrying out consultations with regards to this,” Kaskiv said in a statement published on the agency’s website.

The Spanish company’s denial on Monday made clear it was not even considering the idea of the LNG terminal.

“Gas Natural has not signed any contract to invest in an LNG plant in the Ukraine, nor are we leading any consortium to develop such a terminal... nor are we studying anything along these lines,” the company said in a statement.


After Gas Natural denied Tabernero had been present, Ukraine’s state investment agency identified the mysterious Spaniard as Jordi Sarda Bonvehi. Gas Natural riposted that no such person worked for it.

Energy Minister Yuri Boiko told reporters on Wednesday that the government was checking if Bonvehi had the authority to sign anything on behalf of Gas Natural.

“As far as I understand, they are clarifying technical issues related to whether he (Bonvehi) had the authority (to sign the deal). But this person has taken part in all negotiations on behalf of this company,” Boiko said.

A government source said a Ukrainian official was due to travel to Spain to investigate further.

A Ukraine government official gave Reuters a mobile telephone number he said belonged to Bonvehi and a man answering it said he was the person in question and he might be willing to meet reporters in Spain later in the day.

Reuters could not immediately confirm independently that it had spoken with Bonvehi or with someone else.

Kaskiv said Ukraine would press ahead with the project regardless.

“In any case, the Spanish company’s possible refusal to take part in the project will not be critical,” he said.

Initially he had said Gas Natural would have a 75 percent stake in the consortium and the former Soviet republic would own the remaining 25 percent.

The LNG terminal would allow Ukraine to import gas from suppliers in the Caspian and the Gulf at a price much lower than that charged by Russia’s Gazprom.

Ukraine’s reliance on gas coming by pipeline from Russia has been a source of repeated friction between the two countries and many Ukrainians view it as an unacceptable instrument of continued influence by Moscow.

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