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Gas talks resume, progress challenging

Tuesday, October 21, 2014 - 01:51

Talks aimed at securing winter deliveries of Russian natural gas to Ukraine start in Brussels. But with fighting continuing in Ukraine despite a truce, there are worries the talks may not be able to build on last week's tentative agreement between Presidents Putin and Poroshenko. Ciara Lee reports.

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**RESENDING WITH CORRECTION IN VOICEOVER** Election posters cover walls in this western Ukrainian town. Ukrainians cast their votes this weekend in parliamentary elections. But the country remains deeply divided, with a shaky ceasefire in place between government troops and pro-Russian separatists in the east of the country. More than 3,700 people have been killed in the conflict since April. But amidst continuing violence in eastern Ukraine, leaders are seeking a truce on one issue at least. Russian and Ukrainian energy ministers meeting in Brussels are seeking to resolve the dispute over natural gas supplies. With unpaid bills of more than $5 billion, Russia cut off gas flows to Kiev in mid-June. After months of stalemate, and with winter fast approaching, pressure is mounting for a deal to allow gas deliveries. Differences remain but Russian Energy Minister Alexander Novak said ahead of the talks that he hoped to finalise a deal. The focus is on price, the number of payments Kiev should make, and the volume of gas Ukraine would get from Russia over the winter. Despite cutting off gas for Kiev, Russian exporter Gazprom has not cut supplies flowing through the country en route to EU member states. The European Union relies on Russia for around one third of its gas. And that's profitable for Moscow - state-controlled Gazprom earns around $6 billion a month selling gas to the region. U.S. and EU economic sanctions on Russia plus a fall in the price of oil have increased incentives for Moscow to resolve the dispute. A summit held in Milan last week produced hopes for a breakthrough after Ukraine President Petro Poroshenko met Vladimir Putin and said they had reached a preliminary agreement. They followed that up with a phone conversation today, in which the two leaders reiterated their commitment to the ceasefire.

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Gas talks resume, progress challenging

Tuesday, October 21, 2014 - 01:51