Wednesday, February 27, 2008

Gas man Boyko's interview

Yesterday former head of Naftohaz Ukrainy, now PoR deputy, Yuriy Boyko was interviewed, in Ukrainian, on 'Radio Svoboda'. A partial transcript and link to the audio-file is posted on their site. Taras at Ukrainiana has also provided translations.

Boyko admits some of his colleagues may be participating in Viktor Baloha's new political initiative, which, in Boyko's opinion, is being made "precisely because he [Baloha] is aware the ruling coalition in the format in which it currently exists, is not working.."

He suggests many problems could be better resolved if a more durable, broad coalition were formed in parliament.

He also admits he was invited to a National Security and Defence Council meeting on gas questions, "as an expert" but denies that he, and Dmitro Firtash of RUE, have offered to bank-roll Yanukovych and PoR instead of Rinat Akhmetov.

In some ways the most interesting part of the interview concerns Ukraine's gas imports.
Boyko probably knows more about the darker corners of the Ukraine-Russia-central Asia gas business than any other man because he was closely involved with the creation of the opaque intermediary company RosUkrEnergo.

He states that in the recent disagreement between Ukraine and Russia, there were no debts incurred, as such. All of Ukraine's gas imports are from central Asia - the 4Bcm of supposedly much more expensive Russian gas that Gazprom claim they supplied to Ukrainian consumers as a 'top-up' this winter, is part of normal operations which take place every year because of high winter demand in central Asia. During the warmer months, this gas is returned to Gazprom from the regular supplies of central Asian gas that are continuously piped to Ukraine.

The debts have arisen because of the expiry, and failure to renew contracts by the Tymoshenko administration. Since 1st January this year there has been no contracts between the Russian and Ukrainian sides in which gas prices have been defined, hence the difficulties.

Gazprom today again threatened to reduce gas supplies to Ukraine by 25% on 3rd March unless, debts were repaid. Later in the day first vice-premier Oleksandr Turchynov stated "..Naftohaz has settled its debts from last year. It's a shame that these billions of hryven have been paid by Ukraine to middlemen for debts that were artificially created by predecessors."

p.s. More background on Boyko and his involvement in the gas business in this May 2007 paper [in English] entitled: "The opacity of Russian-Ukrainian Energy Relations", from 'Institut fran├žais des relations internationales'

Part of its conclusion:
"Keeping the trader RosUkrEnergo as the required intermediary of gas relations between Ukraine and Russia, in disregard of any economic rationality, is the most striking illustration of this ambiguous, if not incestuous, symbiosis. The moderation Gazprom has shown in the fall of 2006 has certainly something to do with the position taken by Ukrainian Prime Minister Viktor Yanukovich on NATO, which tends to confirm a linkage between energy issues and broader strategic issues."


Anonymous said...

Turchynov's making things as cloudy as his predecessors - what on earth does he mean by "aritificially created" - perhaps he said a bit more in explanation but as it stands it's just creating scapegoats (Ukraine including Tym and Turch wants to keep the price of gas low but at what (other) price?) and shifting the topic since isn't the argument about this year's unpaid bill?

Taras said...

Don't miss the latest edition of Regionalist's Digest:)!