Naftogaz to pay second tranche of debt to Gazprom on time, by end 2014 - minister

Ukraine will honor commitments undertaken at trilateral talks with Russia and the EU in Brussels at the end of October for Naftogaz to pay a second tranche of debt to Russia's Gazprom by the end of this year, Ukrainian Finance Minister Natalie Jaresko told EurActiv in an interview.

"Ukraine has entered into an agreement with the EU's support and advice, as you know, and we are making payments on a timely basis. We have made one already since my entry into office and another one is due by the end of this year. We will abide by our contracts," she said.

In keeping with the Brussels agreements, Naftogaz paid Gazprom a first tranche of $1.45 billion towards its gas debt on November 4, opening up the possibility for it to buy Russian gas for prepayment before the end of the year. Gas supplies had been halted in June.

Naftogaz, under the same agreements, prepaid Gazprom $378 million on December 5 for 1 billion cubic meters (bcm) of gas to be supplied this month.

Ukraine needs to pay $1.65 billion by the end of this year for gas supplied in the past to be able to buy gas in the first quarter of 2015. Naftogaz has put the funds on a special account with the National Bank of Ukraine. It is expected that the price of Russian gas will fall to $340 per thousand cubic meters in Q1, 2015 in connection with the drop in oil prices.