Russia’s Gazprom confirmed on Wednesday that Naftogaz Ukrainy had paid in full for the gas supplied in April.
According to unofficial information, Ukraine bought 1.8 billion cubic metres of gas with approximately a 425 million U.S. dollar discount.
Ukraine will save up to 250 million U.S. dollars in April thanks to Russia’s gas export discount, Prime Minister Nikolai Azarov told a government meeting.
“The Russian government signed a decree to abolish the gas export duty. Thus, beginning from April it will cost Ukraine 100 U.S. dollars less per each 1,000 cubic metres,” he said.
“Already in April we will pay approximately by 2 billion hryvnia less than Ukraine would otherwise have paid under the previous enslaving contracts,” he said.
He stressed that the funds remaining in Ukraine’s economy should be injected into the introduction of energy saving technologies.
Under the agreements, the price of gas for Ukraine will lowered by 30 percent, but no more than by 100 U.S. dollars per 1,000 cubic metres. The discount would apply to the 30 billion cubic metres to be piped in 2010, and to the annual 40 billion cubic metres to be supplied over years to come.
The addendum also cancelled contract provisions on mutual penalties, which, as a matter of fact, had never been applied.
Ukraine plans to import 36.5 billion cubic metres of gas from Russia in 2010.
Vice Premier Sergei Tigipko said the optimal price of Russia's natural gas for Ukraine would be 230-240 U.S. dollars per 1,000 cubic metres, and added that a draft budget for 2010 included the previous gas price of 334 U.S. dollars per 1,000 cubic meters.
In the first quarter of the year Ukraine bought natural gas at the price of 305 U.S. dollars per 1,000 cubic meters, while in the second quarter this price increased to 330 U.S. dollars.
The price of natural gas for Ukraine in the second quarter of 2010 will be 236 U.S. dollars per 1,000 cubic metres after the discount, Gazprom Bard deputy Chairman Valery Golubev said.
Without the discount, the price would have been 336 U.S. dollar per 1,000 cubic metres.
Pursuant to the latest bilateral agreements, Russia has amended the effective contract for gas supplies to Ukraine. The discount is 30 percent but no more than 100 U.S. dollars.
According to Ukrainian Prime Minister Nikolai Azarov, the lowering of prices on imported natural gas for Ukraine will allow the country to save about 4 billion U.S. dollars annually. “The issue of the gas price is vitally important for us,” he said.
In his opinion, if the current gas prices remain, the country will not be able to reach the targeted GDP growth volume of 3.7 percent in 2010, and the economy will again be in recession.
According to Azarov, the gas price is growing quarterly and has already increased from 330 U.S. dollars per 1,000 cubic metres to 348-350 U.S. dollars. Taking into account the VAT and the cost of transportation to enterprises the gas costs 450 U.S. dollars. “Our chemical industry will stop and metallurgists will also most likely stop working,” said the prime minister.