Tuesday, July 29, 2008

Ukrainian political battle could hit European gas prices

This excerpt from an interesting article entitled:

"Ukrainian political battle could hit European gas prices" from today's British 'Daily Telegraph':

"President Yushchenko and Prime Minister Tymoshenko, former allies since the Orange Revolution in 2004, are locked in a mounting conflict over the price of the gas that is piped across the Ukraine. The country's role as the transit country for 73pc of Western Europe's gas being exported by Russia and the CIS countries makes it vital to the EU's energy markets. What happens in the Ukraine affects what happens further west.
At the heart of the conflict is Tymoshenko's desire to abolish an intermediary arrangement that currently involves gas coming from Russia passing through a Ukrainian company called RosUkrEnergo. Instead she plans to buy gas directly from Russia and the CIS countries, through NaftagasUkrainy, controlled by her government. This is a move that most independent analysts agree will raise the price of gas for consumers in Western Europe.

"Such a course, abolishing a middleman, will increase the price of natural gas and will cause instability in the Ukraine", according to Lidia Lowson at the American Centre for Political Monitoring. "From this instability Tymoshenko will be able to impose her own middleman to calm the situation. That man will be Gayduk.

When contacted, Gayduk's office said he was unavailable for comment.

The reason that the price of gas will rise if bought directly rather than through an intermediary is that its price will be fixed by governments - principally Ukraine's and Russia's - rather than by organisations that operate through commercial criteria.
"Without an intermediary, the governments of Tymoshenko and [Dmitry] Medvedev will be able to dictate prices," Inna Weiss of the Central Group of European Political Monitoring says. "With the existing situation there is a clear interest in co-operation and good relationships with Western Europe. That is what Yushchenko represents."

Is it just me, or is there a whiff of gaseous spin in the air? Would the Kremlin ever permit Ukraine to sell gas westward?


Head of the Presidential Secretariat, Viktor Baloha, on the President's website yesterday accused BYuT of co-operating with the Communists in a report entitled: 'Tight relations between BYuT and the communists are ever more clearly defining the contours of the new majority in the Verkhovna Rada'.

He claims the two parties, together with a portion of NUNS will be forming a new coalition.

He mentions the betrayal of Oleksandr Moroz's Socialists in 2006 in favour of PoR and claims, "Now it is BYuT that find themselves in the role of traitors in the coalition of democratic values.."

He criticizes BYuT for supporting Davyd Zhvaniya, whom the President accused recently of being implicated in his poisoning [After nearly 4 years the Pres. remembers, hmm....]

He comments on Tymoshenko's absence for the commemoration of 1020 years since the conversion of Kyivan Rus' to Christianity thus: Yulia Tymoshenko explained her absence with various excuses: at first it was illness, then later other important circumstances, finally a vacation. "Is it possible that the leader of government adheres not to the orthodox faith, but to some other faith, maybe shintoism or buddhism?" This final snide, rather offensive comment says more about Baloha than Tymoshenko..


elmer said...

So, Baloha wants to attack Tymoshenko for not being "religious" enough, and engages in other stupidities on the Ukrainian President's web sit.

In the meantime - a little more on Vanco.

Surprise - Vanco Prykerchenska British Virgin Islands, the company that mysteriously wound up with a deal to drill offshore Ukraine, and the vehicle by which Akmetov, the Russian Novitsky, and unknown others slimed their way into a government deal through Yanukovych, and Akhmetov (a member of the Ukrainian parliament), with the approval of President Yushchenko ---

IS NOT A SUBSIDIARY OF VANCO ENERGY, headquartered in Houston, Texas.

Rather, as it turns out, Vanco Energy is simply a minority shareholder in Vanco Prykerchenska.

So Vanco Energy wins the bid, and then, mysteriously, Vanco Prykerchenska is formed one day before the deal is assigned to it - with the blessing of Yanukovych, Akhmetov and Yushchenko.

The same Yushchenko who keeps preaching that "corruption is killing Ukraine."


And Baloha wants to attack Tymoshenko for her religion.

How absolutely disgusting.

Anonymous said...

Interesting that the Tymoshenko Government is now concerned about the lawsuit filed by Vanco and is urging them to drop the suit. Makes one wonder just what the government is afraid of, and what they are now tryiing to hide since a lawsuit will publicly expose everyone. http://www.ukrainianjournal.com/index.php?w=article&id=6899

elmer said...

With respect to Vanco, I don't think the Tymoshenko government is afraid of anything.

The article in Ukrainian Journal makes a mistake - it's not Vanco Energy from Houston that has filed for arbitration, it's Vanco Prykerchenska British Virgin Islands.

Publicly suggesting talks during a course of arbitration is not unusual. Indeed, US Ambassador Taylor strongly suggested that the parties should talk.

What appears not to be sinking in, as evidence by the Ukrainian Journal article, and by the comment posted by Anonymous, is that there are 2 entities involved here, and a BIG question that remains to be answered.

The first entity is Vanco Energy or Vanco International, from Houston, Texas, to whom Ukraine awarded a bid for offshore Black Sea exploration and drilling.

The second entity is Vanco Prykerchenska, formed somewhere in the British Virgin Islands, to which the deal was mysteriously assigned under the Yanukovch-Akhmetov regime, and also signed off by Yushchenko.

The second entity involves Akhmetov, who is a member of Parliament and a buddy of Yanukovych, as well as a Russian guy named Novitsky, as well as unknown others, in particular through some mysterious outfit from Austria called Integrum.

The BIG question is - How can Ukraine award a bid to Vanco Energy from Houston, and than have Akhmetov, a member of the government of Ukraine, wind up somehow mysteriously participating in the deal?


Ukraine is a corrupt country, but it's time to stop. As Yushchenko has said repeatedly - corruption is killing the country.

Akhmetov needs to get out of government, or get out of business.

Abuse of the government by Akhmetov and Yanukovych and others for their own personal gain is killing the country.

Anonymous said...

What doesn't seem to be sinking in is a recent report http://uk.reuters.com/article/governmentFilingsNews/idUKL0545513920080705 Quoting Tymoshenko's appointed head of Naftogaz as saying: I would propose talks on joint development of Ukraine's (part of the) Black Sea with Gazprom and talks about joint development of gas deposits on the territory of the Russian Federation," Oleh Dubyna told the weekly Zerkalo Niediela newspaper.

"They are most likely to be interested in the oil on the shelf. We are ready to develop Ukrainian deposits on the shelf and give them oil in return for gas, in which we are more interested," he said.

The Bigger question asks how can the Prime Minister cancel a valid contract on grounds that Gazprom may become involved, then her man in Naftogaz is offering Gazprom Joint Development of the Black Sea Shelf Hmmmm Corruption,... Indeed!!

elmer said...

Here we have the classic sovok "look at the fuzzy monkey" technique.

First of all, the "valid contract" was between Ukraine and Vanco of Houston, Texas.

It was NOT between Ukraine and Vanco Prykerchenska of the British Virgin Islands. To repeat - somehow, with the approval of Yanukovych, who is a buddy of Akhmetov, and Yushchenko, who is kissing up to Akhmetov (who is a member of parliament), the original contract was mysteriously assigned to an entity that did not participate in the bidding process.

Second, if Tymoshenko's man is indeed tossing out a trial balloon out there to see what kind of reaction there is to it, that deal would be FAR more advantageous to Ukraine than the mysterious Vanco Prykecherkenska British Virgin Islands deal.

The reasons are obvious - doing an open and transparent deal between Ukrainian Naftohaz and Gazprom cuts Akhmetov and unknown others out of the deal - and cuts out all of the mystery. Akhmetov, as a member of government, should not be granting government contracts to himself and his buddies. Quite simply, that's a continued abuse of government - hasn't Ukraine had enough of that already?

And I'm sure the revenue sharing percentages would be far more advantageous to Ukraine than the current Vanco Prykerchenska deal which Yushchenko, for some mysterious reason, thinks is great (shall we say that he seeks Akhmetov's support for another bid for president).

So exactly where's the corruption in what Dubyna is proposing?

Anonymous said...

You really are blind.........

Gene said...

I've always wondered why removing a middleman would cause an increase in pricing? Why cannot Ukraine buy direct as Yulia desires? I see no sense in having a middleman.

Elmer...thanks for your input regarding Vanco.

Anonymous said...

Head of the Presidential Secretariat, Viktor Baloha mentions

"the betrayal of Oleksandr Moroz Socialists in 2006 in favour of PoR and claims, "Now it is But that find themselves in the role of traitors in the coalition of democratic values.."

The real betrayal of the so called "Orange revolution" came from Yushchenko and his Our Ukraine Party. They were the party that would not sign-up to the formation of a coalition government back in 2006. Our Ukraine conveniently forget that they were trying to forge an alliance with party of Regions and the clock was ticking.

Moroz realised that our Ukraine could not be trusted to form a stable coalition government and faced with the prospect of the President once again undermining Ukraine's transition to a democratic parliamentary democracy made the correct decision,putting an end to the uncertainly and agreed to form a stable government.

There was no real grounds or legal justification for Yushchenko's attack on democracy and the dismissal of Ukraine's previous Parliamentary Government.

Having acted unconstitutionally Yushchenko's destabilization of Ukraine's democratic government continues today and Ukraine as a result of his actions is arguably much worst off now then it was before.

The sooner Our Ukraine are relegated to oblivion and Yushchenko is impeached or loses office the better off Ukraine and the world will be.