A working meeting between Alexey Miller, Chairman of the Gazprom Management Committee, and Georg Graf Waldersee, Commissioner of the Federal Government of the Federal Republic of Germany for Gas Transit across Ukraine, took place today in St. Petersburg.

The meeting participants discussed issues related to the interaction between Gazprom and Ukraine in the gas sector from 2020 onward.

Alexey Miller pointed out that a number of strategic issues need to be resolved prior to the signing of a new transit contract. The first issue concerns the settling of court disputes between the Company and its Ukrainian counterpart. This would mean a mutual waiver of claims and termination of the court proceedings between Gazprom and Naftogaz of Ukraine regarding the contracts for Russian gas supplies and transit, as well as restoration of balance between the commercial interests of the parties. In addition, the decision made by the Antimonopoly Committee of Ukraine to fine Gazprom for allegedly abusing its monopolistic position in Ukraine’s gas transit market would be reversed and the Company’s violated property rights in the country would be restored.

The second crucial issue is Ukraine’s readiness for direct purchases of Russian gas starting from 2020 and the expected amounts thereof. The decision on the part of Ukraine will directly affect the throughput of the Russian gas transmission system that Gazprom will have to maintain on the Ukrainian border.

It should also be noted that, in order to integrate the EU’s Third Energy Package into the national legislation, the Ukrainian authorities need to, inter alia, ensure the genuine independence of the national energy regulator and create an independent certified gas transmission operator. If these efforts are not completed by January 1, 2020, Gazprom will be willing to extend the effective transit contract for the transitional period taking into account the current market conditions.

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