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Ukrainian PM Rejects Latest Russian Gas Proposal --> Yuriy Yekhanurov (file photo) (AFP) 28 December 2005 -- Ukrainian Prime Minister Yuriy Yekhanurov says Russia's latest price proposal in a gas dispute is unacceptable and amounts to direct economic pressure on Ukraine.

Yekhanurov said today in Kyiv that the gas dispute could eventually end up in international arbitration court. He added that Russia owes Ukraine debts it must pay.

"The Russians owe us nearly 1.5 billion cubic meters of gas in dealing with our Naftogaz Ukrayiny. The head of Naftogaz Ukrayiny has sent an official warning to Gazprom in this regard, demanding that they settle all of their debts. We would like Russia to have no debts to Ukraine as of 1 January," Yekhanurov said.

Yekhanurov's remarks come as Ukraine's Fuel and Energy Minister Ivan Plachkov arrived in Moscow in a bid to defuse a row over Russian gas deliveries to Ukraine.

Plachkov is due to meet with top Russian energy officials.

Russia wants to more than quadruple the price it charges Ukraine for gas as of 1 January. That would bring it into line with world market rates.

Ukraine says it is willing to pay market rates, but wants price increases to be phased in gradually over several years.