Sefcovic proposes Ukraine, Russia sign gas contract for at least ten years

He said this at a press conference following trilateral consultations between the European Commission, Ukraine and Russia in Brussels on Monday, October 28.

"The parameters I proposed highlighted the need for this interconnection agreement between Ukraine and Russia [...] because you would simply need it for any future long-term transit and also for short-term options or capacity allocations. Now we would also need to get the talks within both countries to decide how to approach these outstanding issues, like the [Stockholm] arbitration, like the anti-monopoly findings, and also the level of direct sales to Ukraine," Sefcovic said.

He noted that he had advised Gazprom to get in touch with Ukraine's gas regulator so that at the time of the conclusion of the transit agreement, they could already have agreed a formula and tariffs, which would depend to a large extent on the volume of gas supply and the duration of the contract.

"After listening to all parties, I suggested that we would need a minimum transit volume per year, which would be between 40 to 60 billion cubic meters per year, and also the flexibility margin between 20 to 30 billion cubic meters per year. But I understand that it is, of course, a matter for gas operators to discuss and to include in the final contractual agreement. [...] I also propose that the duration of the contract be a minimum ten years," Sefcovic said.

At the same time, he recalled the position of the Russian side, which believes that tariff setting can change in five years, which, in turn, can cause a dramatic increase in tariffs. Therefore, the Russian side insists on the inclusion in the text of the agreement of possible amendments during this period, which should provide comfortable transit opportunities.

On Monday, October 28, Brussels hosted another round of trilateral consultations between the European Commission, Ukraine and Russia on a new contract for the transit of Russian natural gas to the European market through Ukraine.

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