* Ukraine says stops buying Russian gas for storage
* Medvedev tells Gazprom to stop advance fee payments
* Ukraine's Naftogaz says fees and gas prices linked
(Recasts with Tymoshenko, Kremlin comments)
By Dmitry Zhdannikov and Pavel Polityuk
MOSCOW/KIEV, Sept 7 Ukraine has sufficiently
healthy volumes of stored natural gas to ensure smooth transit
to Europe this winter so it will stop buying Russian gas for
storage, Prime Minister Yulia Tymoshenko said on Monday.
Her comment will be met with relief across the continent,
which experienced a two-week stoppage of a fifth of its gas
supplies last January following a dispute between Moscow and
Kiev over payments.
The reassurance comes after Moscow had warned for months
that Kiev was slow in building up its stocks for winter exports.
"With 25.5 billion cubic metres of gas held in underground
storages, we can cease storing gas. We have established that
25.5 bcm is enough to ... guarantee reliable export of Russian
gas to the European Union," Tymoshenko told reporters.
Tymoshenko, the most popular Ukrainian politician now in
office, wants to avoid a new gas row with Russia in the run-up
to a presidential election on Jan. 17, in which she has said she
Last week she clinched a deal with her Russian counterpart
Vladimir Putin, who allowed Ukraine to import much less gas than
previously agreed, saving Ukraine's strained economy from
potential big fines. [ID:nL1716728]
Tymoshenko's warmer ties with Russia over recent months have
prompted speculation that Moscow may be backing her in the
election to gain influence over the former Soviet republic.
On Monday, Russian President Dmitry Medvedev also praised
Ukraine for timely payments for gas supplies in the past months.
"The fact that our Ukrainian partners are paying is a good
sign. This is a sign that they are following the agreements as
it should be," he told the chief executive of Russian gas export
monopoly Gazprom (GAZP.MM) Alexei Miller.
But Medvedev also told Miller his firm should stop making
advance payments to Kiev of the transit fees it pays to send
its gas to Europe through pipelines across Ukrainian soil.
This was because the agreement reached in January, which
settled the row between Kiev and Moscow, did not make provision
for payments in advance.
The Kremlin transcript quoted Miller as telling Medvedev
that transit fees to Ukraine had been pre-paid until the end of
the first quarter of 2010 - the moment when Ukraine will have a
"As far as the idea of pre-payment of tariffs is concerned,
I want to ask you a simple question: has the (January) agreement
been revised?" Medvedev asked Miller. Miller said it had not.
"Then don't pay," Medvedev said. "We need to act in line
with the agreement which was reached...We are also facing not
the easiest times now," Medvedev added.
The official Kremlin transcript contradicted an earlier
report from Interfax news agency, which said Medvedev had told
Miller not to agree to change gas transit fees. [ID:nL7602291]
That would have been surprising as Moscow and Kiev have
reached many compromises in the past weeks and their comments on
fees only slightly differed last week. [ID:nL325489]
Ukrainian state energy firm Naftogaz said on Monday that
according to the January deal, the transit fees that Gazprom
must pay were subject to an annual change and directly linked to
the import price of gas used for transit.
Last week, Gazprom said it expected gas transit fees via
Ukraine to rise by up to 59 percent in 2010, a similar figure to
Ukraine's expectations of a maximum 60 percent increase.
(Writing by Dmitry Zhdannikov; editing by Anthony Barker)