REUTERS
According to Zahorodniy, Ukraine needs to return to the idea of a consortium.
Political and economic expert Taras Zahorodniy says Ukraine will not be able to get a required compensation from Russia's Gazprom in line with the Stockholm Arbitration award, at least in the near future.
"The issue could drag for a very long time, since Gazprom has enough resources to play this down. Given the corrupt nature of European officials and Gazprom's resources, they can delay everything for a very long time. I think they will not pay, even next year. They will now keep bargaining, offering to retain transit," he said, according to Glavred.
The expert referred to the issue of transit through Ukraine after 2019 as "another problem that Mr. [Naftogaz CEO Andriy] Kobolyev and [Naftogaz CCO Yuriy] Vitrenko do not address."
"No one does anything in this direction. There's no sense traveling around Europe, telling the Germans how dangerous everything is. The Germans look at us as idiots: So what? It's profitable for us. We were directly offered assets, we were given a discount, and Russia is building a gas pipeline at its own expense. This is beneficial to German business.' What can we do here? Nothing," says the expert.
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Zahorodniy believes the latest developments constitute a violation of the rules of the Association.
"The Association says that the Europeans must retain the transit, although it is not said, in what volumes. The Russians say: 'Alright, let's have 15 billion cubic meters.' But it's not profitable for Ukraine. It would be cheaper for us to dismantle our gas transmission network," the economist said.
He added: "All this is a set-up, including on the part of Europeans. No matter how Merkel reassures Ukraine, for us it will mean the loss of 1% of GDP. The Germans are clearly following their interests: they seek to sell gas to Europe and become a European gas hub. They are trying to tell us they will keep the transit, etc. No, that will not work. Why don't you sign some specific papers then?"
According to Zahorodniy, Ukraine needs to return to the idea of a consortium. "We must make compromises, we must understand one simple thing: only Gazprom can provide transit of gas. I think it is necessary to approach the issue pragmatically," he said.
As an example, he mentioned Georgia, which also has a pragmatic approach to this. There, Unified Energy System of Russia owns almost all electric power industry in Georgia, as well as in Armenia. But while affecting politics in Armenia, it fails to do so in Georgia, the expert claims.
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"Therefore, I do not see anything wrong with the fact that Gazprom will be present as a participant, but we must have institutions that will always slap their brazen hands if they get into politics. Then the interest of European companies will be to not to complete the Nord Stream building," he explained.
According to him, Ukraine has a proposal, a gas storage facility that allows smoothing fluctuation. "But we have 'great managers' who buy Cadillacs and talk about how great they are, without really doing anything. Gazprom is a big company that can promote its interests. And if everything continues this way, it will complete the Nord Stream 2 construction," the economist said.
Speaking of prospects for gas production in Ukraine, the expert said: "We are being told that we will accumulate money and start investing in Ukrainian extraction. And where is the guarantee that Ukraine has so much gas to ensure production? Maybe it is better to invest this money in modernization to reduce gas consumption?" No one is doing this."