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Energy: gas contract between Russia and Ukraine nearing completion


A gas war like ten years ago seems averted. Russia and Ukraine have broadly agreed on a new gas transit contract. However, the details are still missing.

Russia and Ukraine almost agree on a new gas transit contract. After tough negotiations, both countries reached an agreement on a new agreement after the EU and the German federal government mediated. Possible bottlenecks in the energy supply seem to be averted from several European countries.

EU Commission Vice President Maros Sefcovic said there are still details to be negotiated in the next few days. Then the contract should also be signed. Federal Minister of Economics Peter Altmaier welcomed the agreement as an important step. "An agreement has been reached in principle, the finalization must now take place," said the CDU politician.

However, the Russian Minister of Energy Alexander Nowak was still cautious. Further votes are needed. "I hope that we can reach definitive agreements soon."

New gas war threatened

Time was short because the current contracts expire at the end of the year. Without a new agreement, another gas war like 2009 would threaten. At that time, many apartments in Eastern Europe remained cold because Kiev and Moscow had fought over prices for gas deliveries to Ukraine and for transit.

Ukraine, which is financially weak, relies on transit fees for the transmission of gas to Germany. The EU Commission brokered the negotiations because Ukraine feels pressured by Russia's market power and believes prices are politically controlled. The ex-Soviet republic, on the other hand, feared that it could lose its position as the most important transit country for Russian gas in the future and thus lose billions of euros in transit fees.

US threatens another company over Nord Stream 2

These fears arise because, in addition to the Nord Stream Baltic Sea pipeline, Russia is also planning to complete the Nord Stream 2 line soon, despite impending US sanctions. US senators called on the Swiss company Allseas to stop work immediately and warned that the threatened sanctions would otherwise ruin the company.

"We understand that the Russian Allseas government is paying a very significant amount of money to complete the Nord Stream 2 pipeline," said Republican Senators Ted Cruz and Ron Johnson to Allseas chief Edward Heerema in a letter. However, if the company continues "even for a single day" after signing the US Sanctions Act, it could face "potentially damaging legal and economic sanctions". The US government had also previously threatened German companies.

The sanctions in the "Law for the Protection of Europe's Energy Security" target the operating companies of the highly specialized ships with which the pipes for the pipeline are laid through the Baltic Sea. Congress has already passed the sanctions law introduced by Cruz. US President Donald Trump had previously announced that he would sign it soon.

Source: spiegel

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