Ukraine warns Gazpom - gas deliveries could be "confiscated"

Kiev, January 02, SPA -- Ukraine's government today upped the ante in
its natural gas conflict with Russia, informing the Kremlin's ongoing
gas shipments to Europe might well be "confiscated " according to
DPA.

The absence of a contract between Russia and Ukraine for gas
deliveries and transfers onward to Europe makes any gas shipped by
Russia into Ukraine technically "of unknown origin," and so subject
to confiscation by the Ukrainian government, wrote Oleh Dubina,
chairman of Ukraine's Naftogaz Ukrainy gas trading company.

Russia cut off gas supplies to Ukraine on January 1 because of
slow Ukrainian payment of debt, and as a negotiating tactic. The
initial Ukrainian response was to bar Gazprom auditors from
inspecting natural gas levels within Ukraine, effectively taking
hostage gas stored in Ukraine by Gazprom for later shipment to
Europe.

As much as 4 billion cubic metres of Gazprom-owned gas - fuel
worth some 16 billion dollars at prevailing European prices - are
stored in Ukrainian reservoirs, according to Ukrainian energy
industry estimates.

Talks between Russia and Ukraine on a new natural gas transfer
contract failed on December 31, after which Russia declared Ukraine
in a gas embargo.

--SPA