UPDATE - Gazprom's Proposal To Extend Transit Contract With Naftogaz Unacceptable - Energy Minister

KIEV (Pakistan Point News / Sputnik - 19th November, 2019) The proposal of Russian energy giant Gazprom to extend the current transit contract with Ukraine's Naftogaz, or conclude a new deal with both sides giving up claims in courts, is unacceptable, Ukrainian Energy Minister Oleksiy Orzhel said on Monday.

"On Monday, we get a sudden proposal from Gazprom. Let's be honest. The proposal that has been received is unacceptable for Ukraine, taking into account the fact that we would need to give up arbitration and sign an agreement for only one year of using our gas transportation system," Orzhel said during the "Freedom of Speech" show on the Ukrainian ICTV tv channel.

On Monday, Gazprom sent Naftogaz an official proposal to extend the transit contract or enter into a new one for one year taking into account the forecast demand in the EU, saying that the prerequisite for continued transit was that the sides must reciprocally give up claims in courts and antitrust authorities.

Orzhel stressed that Naftogaz was seeking a long-term deal and was ready for compromise in terms of its disputes with Gazprom.

"If we sign a long-term contract, we can look for compromise. I hope that Gazprom could agree to such a compromise as well," the Ukrainian energy minister emphasized speaking on ICTV on Monday.

Gazprom said on Monday that both the extension of the active contract with Naftogaz and the signing of a new one were only possible if both sides withdrew all claims filed with the international arbitrage and ceased all court proceedings; if the Anti-Monopoly Committee of Ukraine abolished its decision on slapping Gazprom with a fine over alleged economical competition breach; and if Naftogaz called off its request for the European Commission to launch a probe against Gazprom.

At the same time, Gazprom said it was waiting for the position of the Ukrainian side regarding its readiness to directly purchase Russian gas starting from 2020.

Naftogaz Executive Director Yuriy Vitrenko said later on Monday that Naftogaz had received Gazprom's proposal and would study it carefully before responding.

The current 10-year agreement between Gazprom and Naftogaz expires at the end of 2019, and the European Commission is brokering talks aimed at putting in place a new contract to take effect from the start of 2020.