Gas deals with Russia will not be broken - Yushchenko spokesman

KIEV, February 11 (RIA Novosti) - The recent gas deals signed with Russia will not be broken, the Ukrainian president's representative on energy issues said on Wednesday.

Ukraine's National Security and Defense Council held a session on Wednesday to assess the merits of the gas accords signed with Russia. The council criticized the gas accords with Russia but did not discuss their cancellation.

Bohdan Sokolovsky, the president's international energy security envoy, said the issue of backing out of the deals had never been on the agenda.

The two countries' energy companies, Russia's Gazprom and Naftogaz of Ukraine, signed a gas supply and transit contract on January 19 following negotiations between Russian Prime Minister Vladimir Putin and his Ukrainian counterpart, Yulia Tymoshenko.

Russia suspended supplies to Ukraine on January 1 after the former Soviet neighbors failed to reach an agreement on a new gas contract for 2009. A week later, Gazprom cut off gas deliveries to the European Union via Ukraine, saying the country was stealing gas intended for EU consumers.

Under the terms of the new gas deal, Ukraine will have to pay Russia European market prices - set at $450 per 1,000 cu m for the first quarter - with a 20% discount in 2009 while transit fees fixed under a previous agreement have not been revised.

Sokolovsky said the National Security and Defense Council had instructed the government to approve a financial plan for the national energy company Naftogaz to balance its books in 2009.

Yushchenko has said Naftogaz could face a deficit of 50 billion hryvna (about $6.5 billion) in 2009 as a result of the gas deals with Moscow.