January 27, 2010 / 5:56 PM / in 9 years

UPDATE 1-Yanukovich wants Russia to double Ukraine gas transit

* Says Ukraine could boost Russian gas transit

* Rules out pipelines privatisation

* Says Ukraine could join Nord, South Stream pipelines

(Adds details)

By Richard Balmforth and Pavel Polityuk

KIEV, Jan 27 (Reuters) - Kiev should persuade Moscow to nearly double Russian gas transit to Europe via Ukraine, Ukrainian presidential frontrunner Viktor Yanukovich said on Wednesday while ruling out the sale of transit pipelines.

Yanukovich also said he wanted Ukraine to help build the Nord and South Stream pipelines, planned by Russia to transit gas avoiding states like Ukraine and Belarus after a pricing dispute with neighbours led to gas cut-offs to EU’s customers.

Opposition leader Yanukovich, 59, led Prime Minister Yulia Tymoshenko by 10 percentage points in a first round vote on Jan. 17 and the two rivals face each other in a Feb. 7 runoff for president.

“We will propose Europe and Russia the creation of a consortium, which would allow Ukraine to raise the volumes of gas transit to about 200 billion cubic metres,” he said.

Ukraine usually transits 110-120 bcm of Russian gas a year or a quarter of Europe’s gas use but volumes fell to 96 bcm last year as customers reduced purchases amid the economic crisis and switched to cheaper fuels such as liquefied gas.

Moscow had said it could increase supplies via Ukraine if it was allowed to co-own and manage gas pipelines, but Ukraine adopted a law forbidding their privatisation.

Since then Moscow decided to increase supplies bypassing Ukraine and pricing disputes with Kiev only spurred two key projects, Nord Stream and South Stream, which will deliver gas under the Baltic and Black Sea to Europe’s north and south.

“We are not talking about selling the (transit) system, which is forbidden by Ukrainian law,” Yanukovich said.

“We will introduce proposals about Ukraine’s participation in the building of Nord and South Stream,” Yanukovich told a small group of foreign journalists. He gave no details.

Yanukovich, who is backed by wealthy businessmen in the industrial east of the country, was Moscow’s favourite candidate in the previous presidential elections five years ago, which he lost.

Last year, Russian sympathies switched to Tymoshenko, 49, after she signed a new gas deal with Russia’s Prime Minister and most influential politician Vladimir Putin at the start of 2009 to resume supplies to Europe and avoid new crises.

Yanukovich also said on Wednesday he would not cooperate with Tymoshenko if he won election next month [ID:nLDE60Q29N]. (Writing by Dmitry Zhdannikov; editing by Sue Thomas)

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