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 12 October 2008 00:44 BST

Russia and Ukraine reach agreement on energy debt

Tuesday, 12 Feb 2008 20:13
Vladimir Putin and Viktor Yushchenko announce resolution to Russia/Ukraine gas debt row
Russia and Ukraine have reached an 11th-hour resolution to their long-running energy debt disagreement.

Vladimir Putin told reporters in Moscow that state gas monopoly Gazprom was "satisfied" with Ukrainian assurances the $1.5 billion (£770 million) debt would be paid.

Gazprom had threatened to cut supplies to its neighbour in a bid to force the issue, which would have led to a repeat of the 2006 situation when European Union gas supplies were hit by a similar row.

EU member states are largely dependent on Russian gas supplies that pass through Ukrainian pipelines.

But Mr Putin said he and Viktor Yushchenko, Ukraine's president, had worked out a "general short-term roadmap" following last-ditch talks in the Russian capital with a Gazprom-imposed deadline looming.

"We heard our partners say today that the debt will soon be paid off, and we agreed on the principles for cooperation in 2008 and consecutive years," the outgoing Russian president said in comments reported by state news agency RIA Novosti.

Mr Yushchenko added: "We agreed that Ukraine will pay back the debt."

His Russian counterpart said Moscow regretted the dispute and explained a "common plan for working in the near future" had been agreed upon.

"Tomorrow we hope for the agreements to be put on paper," Mr Putin added.

The energy row has largely been viewed in the west as being politically grounded.

Russia is angry at Kiev's move towards the EU and Nato, while Ukraine's support of a US missile defence shield has further increased tensions.End of story


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