MOSCOW, (Tatyana Stanovaya for RIA Novosti). Ukraine is planning to raise the question of liquidating the gas consortium, which was established in 2002 with the blessing of the Russian and Ukrainian presidents and German Chancellor Gerhard Schroeder.
Talks are currently underway with Turkmenistan on a direct purchase of Turkmenian gas and on laying a pipeline that would bypass Russia. It is obvious, however, that it would be impossible to go through with these plans, at least in the near future. The gas consortium got a second wind in August 2004, when Ukraine was getting ready for its presidential elections. The Russian president, understanding that the future successor of the then Ukrainian President Leonid Kuchma needed Moscow's support, insisted on Ukraine's signing the most important documents on the gas consortium and on the Common Economic Space project. The gas consortium, which provides for building a gas pipeline between Bogorodchany and Uzhgorod, gives Gazprom the possibility to control the export of gas, which has been known to disappear from time to time in Ukraine.
After Viktor Yushchenko came to power, Ukraine faced the need to get rid of its excessive gas dependence on Russia. A telling example is the Ukrainian government's attempt to make Russian oil companies sell gasoline at lower prices. There are numerous ways of pressure on Russian business: inspections by controlling agencies, a risk of instituting criminal proceedings, suspicions of violating antitrust legislation and others types of administrative manipulation. It is more difficult in the gas industry, as Ukraine, to its chagrin, has no chance of coming to terms with Gazprom by using the same methods.
It was therefore decided to look for alternative ways. As is known, Gazprom supplies Turkmen gas to Ukraine. By purchasing gas in Turkmenistan directly or, better still, laying a pipeline bypassing Russia, Ukraine might have a shot at independence if it weren't for one problem. Turkmen President Saparmurat Niyazov promised it would sell almost all Turkmen gas to Russia. But at the same time, during the recent talks with Yushchenko, he expressed readiness to sign a gas contract with Ukraine as well.
However, Niyazov has his own "economy". Turkmen gas supplied directly to Ukraine will cost more than delivering it via Russia. Turkmenistan has big problems in relations with the West, which has accused Niyazov of dictatorial ways, human rights violations and suppressing the opposition. After the wave of "color revolutions", the regimes unaffected by them have swung towards Russia. This is evident from statements by Uzbekistani and Kazakh leaders. As for Turkmenistan, it cannot but be friends with Russia. If the opposition becomes active in the republic, the West, as well as Georgian President Mikhail Saakashvili, whom the West sees as a guarantor of democracy in the post-Soviet space, will surely support opponents of the Niyazov regime. And even a potential gas contract with Ukraine will not allow the latter to stand up for Niyazov. Understanding this, Niyazov is maneuvering cautiously between Ukraine and Russia. It was not without reason that, instead of expressing gratitude to Yushchenko for awarding him the Order of St. Prince Yaroslav the Wise, 5th grade, he accused Ukrainian companies late in May of overstating the prices of work and equipment in the investment projects in Turkmenistan.
Nevertheless, reliance on Turkmenistan gave the Ukrainian government a chance to propose the liquidation of the gas consortium. As Alexei Ivchenko, who heads the Naftogaz Ukrainy company, said, it is inexpedient to establish a consortium for using Ukraine's existing gas supply system. He said no outside investments were needed to maintain it in a working regime. "The gas transportation system will be only Ukrainian and only state-owned. We can invite new partners only for carrying out new projects," he said.
Gazprom responded by announcing that the prospect of the consortium's liquidation was quite real, and presented a bill for 7.8 billion rubles to Ukraine for an allegedly stolen amount of gas. It also proposed to give up barter trade in transactions with Ukraine and switch to trade on market principles and supply gas at European prices.
The move was a success and Ukraine asked Russia practically immediately to preserve the former gas transit terms. The stolen gas was also found at once. So, refusal to join the consortium appeared to be an all too expensive pleasure for Ukraine. Turkmenistan, too, was given an unambiguous signal: on June 7, Deputy Chairman of Gazprom's Board Alexander Ryazanov expressed doubts that Turkmenistan had the declared gas reserves.
At the same time Ukraine's problem is not only to find an alternative source of gas. There is no common opinion in Yushchenko's team on what the consortium's future should be. The government and Naftogaz Ukrainy have taken a radical stance on the issue. The consortium must be liquidated and a new deal should be made from scratch, with Germany and France invited to participate, said Alexander Gudyma, a parliament member close to Premier Timoshenko and chairman of the subcommittee for the gas industry.
The Yushchenko's position is more moderate. He said in March that a possible establishment of a consortium with Turkmenistan should not be an alternative to the Russian-Ukrainian gas consortium. Pyotr Poroshenko, chairman of the Council for National Security and Defense and a long-time opponent of Ukrainian Prime Minister Yulia Timoshenko, expressed his view in more definite terms. He said a liquidation of the consortium set up for the management and development of Ukraine's gas transportation system would not be in the interests of either Russia or Ukraine. All this gives Moscow room for maneuvering.
Tatyana Stanovaya is a leading expert of the Center of Political Technologies' analytical department.
