Workers in Russia's Vologda region Vologda region weld a segment of the Baltic Sea gas pipeline (file photo) (epa)
31 January 2006 -- Russian President Vladimir Putin said today that Ukraine must pay for using more than its agreed quota of Russian gas from an export pipeline that leads to Europe.
Addressing reporters at a Kremlin news conference, Putin said that during the recent cold spell Ukraine has siphoned off up to 70 million cubic meters of gas a day, hampering efforts by Russia's natural-gas monopoly Gazprom to normalize supplies to Europe.
Putin praised Ukraine's leadership for admitting for the first time that it had taken more gas than agreed.
He added that Ukraine's actions vindicated Russia's 2005 agreement with Germany to build a pipeline along the bed of the Baltic Sea to connect the two countries directly.
Putin also hailed a recent agreement with Ukraine on Russian natural gas supplies as "very positive" for bilateral relations and for the stability of the European energy system.
The agreement came after Russia cut off gas supplies to Ukraine at the end of last year over a pricing dispute.
(Interfax, ITAR-TASS, AP)
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- Ukraine consumes 70 billion cubic meters (bcm) of gas per year. It produces 20 bcm of its own gas, has a signed contract to import 40 bcm from Turkmenistan, and in 2005 was getting 29 bcm from Russia as payment for transit of Russian gas.
- Ukraine sells some 7 bcm of gas a year to the West and places some in underground storage facilities. These facilities can hold 34.5 bcm.
Ukraine is the sixth-largest consumer of gas
in the world and uses more gas than Poland, the Czech Republic, Hungary, and Slovakia combined.
- Russia has proven gas reserves of 47 trillion cubic meters (tcm) -- the largest in the world ahead of Iran and Qatar.
Russia sells approximately 160 bcm to Europe each year.
By 2015, Europe is expected to import 300 bcm, or 40 percent of its projected needs from Russia.
Russia's Gazprom is the world's largest gas company.
It is the only company allowed by Russian law to export gas outside the borders of the CIS. It also owns the gas-transportation system and most of the gas fields in Russia.
The Russian state is Gazprom's majority shareholder
, with a 51 percent share. The company's ownership rights changed as of the beginning of 2006, with Gazprom stock being sold on the open market. The Russian state, however, will continue to hold the majority stake.