Ukraine Denies Causing Russian Supply Drop

Ukrainian energy comany Naftogaz Ukrainy has denied allegations that it is responsible for a drop in supply, after Deputy Chairman of Gazprom, Alexander Medvedev said yesterday he was "perplexed" by reports of a decline in supply to Russia.

Responding to media reports that Gazprom's supply ability had been affected by severe cold weather in Russia, Mr. Medvedev said the company had actually increased supply.

"Amid the freezing winter in Russia and Europe, our company has boosted gas supplies to the maximum," he said. "Offtake of gas from European storage has quadrupled in the past week."

He also said that Ukraine was offtaking gas, far above the country's contracted levels for supply.

"Ukraine is currently taking gas at the annual pace of 60 billion cubic metres, which is significantly above contracted levels," he said.

However, Naftogaz has denied that it has taken more than its fair share of gas, and was relying on its own reserves to meet any shortfalls.

Naftogaz "guarantees the fulfillment of natural gas supply schedules to the consumers of Europe and Ukraine," a statement from the company said.

"The company also states that the volumes of natural gas transit through the territory of Ukraine and the volumes of imported natural gas extraction are at the level defined by the contract with Gazprom OJSC. Natural gas consumption increase in Ukraine, related to heavy frosts, is compensated only on the account of natural gas extraction from the Ukrainian underground gas-storages."

Lowered supply amounts continue to be reported across Europe. Yesterday, Polish company PGNiG reported that its import volumes from Gazprom were down by 7 per cent.

"PGNiG has intervened at the supplier (Gazprom) and awaits its response on the matter," a statement from the company said.