Publication: Monitor Volume: 1 Issue: 94

… Ukraine has decided against turning its giant gas storage sites over to a Russian-dominated joint company in payment for past Russian gas deliveries. Under a Russian plan which Ukraine had tentatively accepted in March, the Bilche-Uhersko and Bohorodchany storage depots, ranked as Europe’s largest and accounting for 70 percent of Ukraine’s total gas storage capacity, were to be taken over by Gaztranzit, an affiliate of Russia’s Gazprom, under the guise of its participating in the privatization of Ukrainian industry. But Ukrainian government agencies and parliamentary deputies squashed the deal by reappraising the value of the storage sites out of Gaztranzit’s reach, and by reclassifying them as ineligible for privatization. (11) Russia’s preferred method of collecting debts from former Soviet countries is by acquiring equity in their industrial plants and energy infrastructure through specially created, Russian-controlled shareholding companies. The property thus acquired can then serve as a means of economic and political influence. Ukraine, which had its energy arrears to Russia rescheduled in 1994, and has since been paying its energy bills on time, is reasonably well placed to avoid such onerous deals.

…Makes Deal with Turkmenistan.