"We made the extension decision already in 2010 when it is essential for us. The spoon is dear when lunchtime is near, as they say," Yanukovych said.
He said that the simultaneously reached understandings on the Black Sea Fleet and gas deliveries are beneficial. "We found a mechanism that allowed us to make the two decisions simultaneously," he said.
Those comments are from President Viktor Yanukovych who successfully negotiated a gas price discount with Russia. According to the New York Times, the Russians get a 25 (!) year lease extension on the naval base in Crimea , while the Ukrainians get a 30% gas price cut, to around $240 per ton cubic meters. The Regions-led government is focusing on the lower price that Ukraine will pay for gas, second lowest after Belarus (under the new agreement between Ukraine-Russia).
"This price is lower than in Poland, Slovakia, Czechia, Hungary, Romania, where it is in the second quarter in the range of 300-330 dollars" - Borodin said.
"This price is lower than in the Baltics, where in the first quarter it was around 260 dollars. In the second quarter it will probably be closer to 275-280 dollars. It is less than in Moldova, where in the first quarter price was 231 dollar ", - he said.
That's Konstantin Borodin from the Oil and Gas Ministry commenting on the new agreement in Ukrainska Pravda. He also points out in the article that Ukraine didn't have to surrender partial control of the GTS to the Russians. However, there hasn't been any mention (that I've read so far) on how long the cheap price would last for Ukraine. The NY Times article also doesn't have any information concerning the cost to lease the base, currently at $100 million per year. Did the Russians agree to pay more or is this locked down for 25 years as well?
I would be surprised if the Ukrainians managed to persuade the Russians to a 25 year gas price discount. The deal being replaced was meant to last ten years, but a formula was used to revalue the gas price every quarter. There doesn't seem to be anything available right now concerning the new price scheme. Meanwhile, the Russians have successfully removed an important bargaining chip for Kyiv. Granted, Ukraine could ask to re-negotiate the base agreement at a later time, but i'ts unlikely under this president.
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