Bohdan Sokolovsky Russia's likely refusal to adjust gas contracts is a serious threat to Naftogaz Ukrainy' normal operations and, for that matter, to an uninterrupted transit of Russian gas across Ukraine, said Ukraine's presidential energy security advisor Bohdan Sokolovsky.

"Media reports claiming that the Russian president will stand firm over the terms, agreed upon on January 19 2009, can be interpreted as additional proof that the 2009 gas scenario was not accidental and could be used in Ukraine as an election gimmick," the Ukrainian presidential press service quoted Sokolovsky as saying on Tuesday.

"Responsibility for the gas contracts' negative effect on Ukraine, and for a revision of its individual provisions rests on the government, which was to apply maximum effort to amend the mistakes made when the contracts were being signed," Sokolovsky said.

Viktor Yuschenko strongly insisted that the gas contracts must be adjusted and that long-term cooperation of partners established between Ukraine and Russia in the gas sector, he said.

But Sokolovsky noted progress in the dialogue between Naftogaz Ukrainy and Russia's Gazprom (RTS: GAZP) on ways to stabilize cooperation in gas shipments and transit.

"The two countries' prime ministers and the management of Naftogaz have declared recently that they were ready to make mutually acceptable adjustments in the contracts, which is welcome," Sokolovsky also said.

Ukraine plans to cut natural gas imports significantly in 2010 against the obligations, laid down in the contracts signed in January 2009, Ukraine's Prime Minister Yulia Tymoshenko said on Monday.

Ukraine proposes to reduce gas purchases from 52 billion cubic meters down to 33.75 billion cubic meters, which will allow it to import 27 billion cubic meters of gas, avoiding fines for taking less gas from Russia than agreed, said Ihor Didenko, Naftogaz's first deputy CEO.

Yuschenko said on many occasions he strongly doubted that Russia would refrain from advancing sanctions.

Russian President Dmitry Medvedev said on September 7 that Naftogaz had again asked Gazprom to pay for gas transit in advance, and he urged Gazprom CEO Alexei Miller to reject this offer and to stick to the contracts, signed in January. Gazprom has already paid for gas transit across Ukraine in advance for the period until the end of the first quarter of 2010, he said.

The gas contracts, signed in January 2009 for the period ending in 2019, seal the so-called take-and-pay arrangements. Under these arrangements Naftogaz must acquire no less than 80% of the natural gas, agreed for this year, or at least 32 billion cubic meters, and no less than 41.6 billion cubic meters starting from next year.

In the first quarter Naftogaz violated the contracts almost monthly, taking less gas than agreed. The contract envisioned the shipment of 5 billion cubic meters of gas in the first quarter, 10 billion in the second, 12 billion in the third and 12.5 billion in the fourth. However, the company imported 2.8 billion cubic meters of gas in the first quarter and about 5.7 billion cubic meters in the second. Formally, Gazprom has the right to fine Naftogaz $5.25 billion, according to Yuschenko estimate.

In the third quarter Naftogaz imported 3.2 billion - 3.3 billion cubic meters of gas each month. Given this, it has yet to buy at least 16.9 billion cubic meters before the end of the year, or 4.2 billion cubic meters monthly. But Tymoshenko said on September 7 that Ukraine could decide not to pump Russian gas into the underground storage facilities, which will mean a serious reduction of gas imports.