Looking to the Future EU Commissioner Stresses Importance of Alternative Gas Pipeline

Russia and Ukraine have finally agreed on a settlement over gas prices and transport fees, which could see supplies reaching Europe again within the next few days. Still, European Commissioner Günter Verheugen has sharply criticized the actions of both countries and is calling for secure gas supplies through alternative pipelines.

The infighting between Russia and Ukraine, which led to gas shortages across much of the European Union for two weeks, appears to have been resolved on Monday. Russia and Ukraine signed a 10-year gas supply deal that would see the restoration of natural gas shipments to Kiev. Still, although it appeared clear that gas supplies would soon be piped through Ukraine to the European Union, politicians said both Moscow and Kiev have proven to be unreliable partners for Europe -- and they are looking to secure alternate gas routes in case of future disputes.

Russia and Ukraine have resolved their dispute for now. Still, Europe wants to make sure it won't fall victim to their infighting in the future.

Russia and Ukraine have resolved their dispute for now. Still, Europe wants to make sure it won't fall victim to their infighting in the future.

"I can't give you any information about what procedures are being undertaken there or how you can sue," said European Commissioner for Enterprise and Industry Günter Verheugen of Germany. "But it is a fact that we are defending ourselves and that we are showing that we won't just sit back put up with it."

Verheugen was responding to recent threats made by European Commission President Jose Manuel Durao Barroso that Brussels would sue both its Russian and Ukrainian contract partners. He added that it was terrain that had never been covered before by the EU.

Verheugen also called for decreased dependence on Russian oil and gas supplies and Ukrainian pipelines for delivery. He furthermore stressed the importance of speedy progress on projects like an underwater Baltic Sea pipeline, which will bring Russian gas directly to Germany and bypass other countries.

Verheugen, who previously supported EU membership for Ukraine, expressed clear disappointment over the fact that the country blocked Russian gas from entering Europe after the Kremlin restored supplies under the watch of European observers last week. Ukraine's actions -- which resulted from disagreements over gas prices and transit fees -- undoubtedly hurt its hopes for future EU and NATO membership, Verheugen said.

Fingers have been pointed at both Ukraine and Russia. Ukraine has been accused of shutting off supplies to the EU. And last week, EU gas experts accused Russia of deliberately sending gas to areas where it is technically difficult to transfer on to Europe.

During a visit with German Chancellor Angela Merkel on Friday, Russian Prime Minister Vladimir Putin strenuously denied the allegation. At the same time on Friday, a group of German, Italian and French gas companies -- including E.ON-Ruhrgas, ENI (Italy) and Gaz de France -- said they would create a consortium that would provide the "technical gas" needed by Ukraine to run its compressor stations in order to again pump normal gas supplies to Europe again. This will mean buying 21 million cubic meters of gas per day at a cost of a half-billion euros during the first quarter of the year.

This plan is part of the EU's attempt to help both countries move passed their dispute, which has left many Europeans without heat since the start of the year.

The impasse between Moscow and Kiev ended on Sunday night after Putin and his Ukrainian counterpart Yulia Timoshenko met an agreement after hours of negotiations. Under the terms of the deal, Ukraine will pay world market gas prices starting next year and, for the rest of 2009, will receive a 20 percent discount provided it does not increase gas transit fees, which will remain the same as before the standoff.

EU officials welcomed Sunday night's settlement, but many were hesitant to believe that peace in the gas conflict would be lasting. On Sunday, a spokesperson for the Czech Republic, which is currently the six-month rotating president of the EU, said greeted the deal. At the same time, the spokesperson added, many past agreements have been reached only to be violated later on.

German Economics Minister Michael Glos of the conservative Christian Social Union, the Bavarian sister party to Merkel's Christian Democrats, said: "As pleasing as this agreement may be, it is just as important that customers again get their gas quickly and that deliveries in the future follow reliably."

-- cew with wires


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