You're reading: Russia says Ukraine cannot break gas deal

PORTOVAYA, Russia, Sept 6 (Reuters) - Russia's top energy official said on Tuesday that Ukraine cannot unilaterally break a gas deal at the heart of a pricing dispute, ratcheting up the rhetoric over a 2009 supply contract struck after a dispute disrupted gas supplies to the European Union.

Ukraine, which has told Russia it wants to renegotiate the gas agreement to secure lower prices and import less gas, has said that if the two sides cannot reach agreement it will seek arbitration in Stockholm.

Moscow has said that to revise the deal, Ukraine must either join a Customs Union with Russia, Kazakhstan and Belarus or sell its pipeline grid to Russia.

"You cannot just unilaterally break a contract," Deputy Prime Minister Igor Sechin, a close ally of Prime Minister Vladimir Putin, told reporters at a natural gas pumping station near the town of Vyborg in northern Russia.

The 2009 deal, reached by Prime Minister Vladimir Putin and former Ukrainian Prime Minister Yulia Tymoshenko, came after Russian state gas producer Gazprom cut supplies to Ukraine in a winter pricing dispute.

Ukraine has not suggested it will break the contract but the European Union is closely watching the dispute as it gets about one fifth of its gas needs from mostly Soviet-era pipelines which pump Siberian gas across Ukraine.

In 2011, Ukraine envisages importing from Russia for its own use about 40 billion cubic metres (bcm) of gas at a cost of between $264 per 1,000 cubic metres in the first quarter and $400 per 1,000 cubic metres in the fourth quarter.

Ukrainian Energy Minister Yuri Boiko has asked to slash gas purchases to just 27 bcm next year, drawing a terse response from Gazprom chief Alexei Miller, who has said that Ukraine must buy 33 bcm under the ‘take or pay’ terms of their gas contract.

"There are obligations. Under any circumstances the involved parties have to stick to the obligations," Sechin, who oversees Russia’s oil and gas sector of the world’s biggest energy producer.

Last year 95.4 billion cubic metres of Russian gas crossed Ukraine into Europe but Russia is about to open a new pipeline — Nord Stream — that will send gas under the Baltic Sea to Germany and Western Europe, thereby bypassing Ukraine.