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ENERGY TECH
Russia may lose energy game over Ukraine, U.S. says
by Daniel J. Graeber
Washington (UPI) Apr 17, 2013


Italy's Eni looks for ways to help Ukraine
Kiev, Ukraine (UPI) Apr 18, 2013 - Italian energy company Eni said it was looking for new ways to supply natural gas to a Ukrainian economy struggling to break free of Russia's grip.

Eni Chief Executive Officer Paolo Scaroni met in Kiev with Ukrainian Energy Minister Yuri Prodan to discuss increasing the availability of natural gas in the country.

The Italian company said Thursday both sides agreed that shale natural gas exploration and conventional gas reserves may provide a layer of protection to Ukraine's energy sector.

Ukraine is one of the Eastern European countries thought to be rich in shale natural gas reserves, though exploration programs are in their infancy.

German energy company RWE said Tuesday as much as 353 billion cubic feet of natural gas per year would flow from Poland to Ukraine under the terms of a contract signed in 2012.

Ukraine hosts the bulk of the Russian natural gas supplies headed to European consumers. The Kremlin warned European energy security may be at risk because Ukraine hasn't been able to settle a multibillion dollar gas bill.

Russian energy company Gazprom said it may transfer Ukraine's contract to a pre-payment mechanism, but would wait to see how the European community reacted to an energy security letter sent to regional leaders last week by Russian President Vladimir Putin.

Russia has "a lot to lose" if it continues to use energy as a geopolitical tool in the row over Ukraine, a U.S. State Department spokeswoman said.

Russian President Vladimir Putin warned European energy security was at risk because of disputes over Ukraine's gas debts. Russian company Gazprom suspended a price discount for Kiev following the February upheaval and Ukraine could lose out on gas supplies if it doesn't settle its debt, Putin said.

State Department spokeswoman Marie Harf said the U.S. government was frustrated with Russia's use of natural gas as a weapon.

"We've said very clearly that Russia should not use this as a weapon and that, actually, Russia has a lot to lose if they try to do so," she said during her regular press briefing Wednesday.

Russia sends the bulk of its natural gas supplies for European consumers through the Soviet-era gas transit network in Ukraine.

Russian Prime Minister Dmitry Medvedev said he wasn't optimistic about what he said was a "very complex" economic situation in Russia.

[ITAR-Tass]

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