National Joint-Stock Company Naftogaz of Ukraine has announced completion of GTS unbundling as executives of PJSC Ukrtransgaz and PJSC Magistralni Gazoprovody Ukrainy [Trunk Gas Pipelines of Ukraine] (MGU) have signed the acceptance-delivery certificate after which the LLC Gas Transmission System Operator of Ukraine (GTSOU) was officially transferred to the MGU, an entity owned by Ukraine's Finance Ministry.

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"In addition, GTSOU has received assets of the Ukrainian gas transmission system [GTS] by a separate certificate. The acceptance-delivery certificate contains over 47,000 items with a book value of over UAH 32 billion [US$1.4 billion]. The move was pre-agreed by all parties involved in the unbundling, including Naftogaz, the State Property Fund, the Ministry for Development of Economy, Trade and Agriculture, the Ministry of Finance, the Ministry of Energy and Environmental Protection," Naftogaz's press service said on January 1.

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"This was the final stage of the process of separating the gas transmission system of Ukraine from Naftogaz. An unbundling of the GTS was completed as scheduled. The new independent TSO started fully independent operations today," the press service added.

According to Naftogaz, this was the most significant reform in the energy sector over Ukraine's independence.

"Our country has complied with the requirements of the [European Union's] Third Energy Package and has demonstrated that it is a responsible and reliable partner for the EU. Naftogaz has ceased to be a shareholder in the GTS operator. We will be its major client and are ready to continue joint support of initiatives aimed at developing a competitive and transparent gas market," Naftogaz CEO Andriy Kobolyev said.

As UNIAN reported earlier, on October 31, the Verkhovna Rada passed the bill on the unbundling of the gas transmission system from Naftogaz with the GTS remaining wholly owned by the state.

UNIAN memo. Unbundling is the separation of natural gas transmission activities (by the GTS Operator) from the production/generation and supplies of natural gas and electricity.

Effective unbundling is expected to become the key to the formation of an independent operator of Ukraine's GTS certified by European requirements. The existence and work of such an operator will strengthen the position and role of Ukraine in talks with Russia on the extension of transit and preservation of Ukraine's GTS from 2020.