The Secretariat of the Energy Community of the EU and neighboring countries has confirmed that the newly established operator, Ukraine’s gas transport system (GTS), has been separated from Naftogaz in accordance with the requirements of European legislation.
The secretariat said in a statement that the decision was based on a bill passed by Ukraine’s Verkhovna Rada which unbundled the GTS from the national company Naftogaz of Ukraine. The bill was passed and si ned by the president in mid November. The Ukrainian GTS will work as an independent system operator starting on January 1, 2020.
An independent operator was required by the EU’s Third Energy Package, which enforces a differentiation between the functions of gas transportation, storage, production and sales. These functions are currently being performed by Naftogaz and its direct subsidiary UkrTransGaz.
Ukraine hopes that its compliance with European legislative standards will strengthen its bargaining position in gas transit negotiations, and will also safeguard its economic interests.
Naftogaz called the secretariat’s decision an important step towards completing the unbundling. “We are grateful to the Secretariat of the Energy Community for the rapid consideration and positive conclusion regarding the certification of Ukraine’s independent GTS… Ukraine has once again demonstrated that it keeps its commitments,” the company’s press service cited Naftogaz CEO Andriy Kobolyev as saying.
The Energy Community is an international organization between the EU and its neighbors for the creation of a common European energy market. In addition to the EU, which is represented within the organization by the European Commission, the community includes Albania, Bosnia and Herzegovina, Kosovo, North Macedonia, Georgia, Moldova, Montenegro, Serbia and Ukraine. Another three countries – Armenia, Norway and Turkey – participate as observers.