Naftogaz Ukrainy has proposed that Gazprom set the price of gas at the level of quotations on European gas exchanges (net of transit costs) pending a ruling on their dispute over prices in Stockholm arbitration.
“Pending the arbitration ruling, the price of gas will be equal to the price at the European gas hubs less the cost of transportation from the Russian border to those hubs,” Naftogaz said in a statement published ahead of talks on gas – with the potential participation of the European Commission – scheduled for Sept. 6.
Doing so would significantly simplify the discussion aimed at setting a fair market price for Ukraine, Naftogaz said.
Commodity exchange prices accord with the principles of a fair and market-oriented approach, as provided for in the current gas contract with Gazprom, which allows for reviewing the gas price given changes in the market situation.
Use of exchange-based prices predominates in Gazprom’s contracts with European companies, Naftogaz said.
“The Ukrainian side is ready to discuss the technical aspects of implementing this proposal in accordance with European practice,” the statement says.
Naftogaz also proposes using that methodology to pay Ukraine’s gas debt, before the arbitration court ruling.
Russian Energy Minister Alexander Novak said previously that Russia and Ukraine had agreed to hold the trilateral meeting on Sept. 6. The European Commission has yet to confirm it will take part.
