Russia Resumes Gas Supply to Ukraine

Russia Resumes  Gas Supply to Ukraine
Russia Resumes  Gas Supply to Ukraine

Russia resumed gas flows to Ukraine on Tuesday after halting them six months ago in a dispute over prices and unpaid debts, Ukraine's gas transport monopoly said.

"Ukraine has started receiving Russian gas. The volume of imports is around 43.5 million cubic meters per day," Ukrtransgaz spokesman Maxim Belyavsky was quoted by Reuters as saying. Supplies will flow via the northern Belarussian pipeline of Mozyr and the eastern Sudzha route, he added.

The ex-Soviet republic consumes about 200 million cubic metres on average per day during the winter.

Without Russian gas and short of coal because separatist violence has disrupted domestic coal mining, Ukraine has been forced to introduce widespread power cuts.

With relations poor because of the fighting in Ukraine's east, Russia had insisted that Ukraine pay upfront for renewed supplies over the winter, under an interim agreement in October.

Cash-strapped Ukraine delayed for as long as possible but after a cold snap that sent temperatures plummeting below freezing, Ukrainian state energy firm Naftogaz transferred a $378 million prepayment to Russia's Gazprom to buy 1 billion cubic metres (bcm) of Russian gas in December.

Ukraine's gas reserves have fallen by more than 20 percent since October to 13.3 bcm as of Dec. 6. Gazprom confirmed in a statement that gas shipments had resumed to Ukraine Tuesday.

Gas payments to Russia and efforts to support the struggling hryvnia currency have forced Ukraine to draw deeply on foreign currency reserves, which have fallen to a 10-year low. The depleted state of central bank coffers means the International Monetary Fund may need to ramp up an ongoing $17 billion bailout program.