WILL UKRAINE LAY A NEW TRANSIT PIPELINE FOR GAZPROM?

Ukraine–in arrears by US$1.1 billion to Russia’s Gazprom, and accused repeatedly of pilfering Russian gas bound for third countries–plans to lay a transit pipeline as a service to the Gazprom company through its territory. The construction cost, projected at US$250 million, would be deducted from Ukraine’s arrears.

The new pipeline is planned to run 550 kilometers in parallel to an existing line from Ananyiv to Izmail in the Odessa region. At Izmail the new line would branch into the main export line which carries Russian gas into Romania, Bulgaria, Greece and Turkey. The new line is intended to add 25 billion cubic meters to the annual flow of Russian gas into the Balkans. Naftohaz Ukrainy–the state oil and gas company–has designed and will build the pipeline until the year 2002. According to its chief Ihor Bakay, Naftohaz has signed an agreement with Gazprom regarding transit services and financial settlements (UNIAN, Dow Jones Newswires, February 6, 8).

Gazprom chief Rem Vyakhirev, however, denied yesterday that his company has signed a contract for the project. Vyakhirev stated, moreover, that Gazprom will not increase, and may even seek to decrease, the volume of gas exported via Ukraine as long as the latter siphons off gas from the transit pipelines. Gazprom would like to circumvent Ukraine, first, by adding a westbound transit pipeline to the one already running through Belarus, and, second, by laying a southbound pipeline on the bottom of the Black Sea to Turkey–the Blue Stream project (Itar-Tass, February 8; Eastern Economist Daily (Kyiv), February 9).–VS

UKRAINE UNCERTAIN ABOUT IMF LOANS.