Medvedchuk pulls Russian gas to Ukraine: what is the danger

The leaders of the “Opposition platform - For life”, which took second place in the early parliamentary elections, Viktor Medvedchuk and Yuriy Boyko regularly visit Russia, where, among other things, they negotiate the supply of Russian gas to Ukraine. "Apostrophe" inquired how real this scenario is, and whether it carries any risks.

The representative of the President of Ukraine in the Cabinet of Ministers Andrii Herus proposed to the leaders of the “Opposition platform - For life” party Yuriy Boyko and Viktor Medvedchuk to establish a private company to perform gas supplies from Russia. He made this statement after another visit of Boyko and Medvedchuk to Russia, during which they held "talks" with Russian Prime Minister Dmitry Medvedev and the head of "Gazprom" Alexei Miller on the resumption of Russian gas supplies to Ukraine.

The words of Herus can be perceived as a kind of trolling, because both politicians today are private individuals and in the near future are unlikely to take any positions in the executive power of Ukraine. At the same time, they behave as if they represent the Ukrainian state at such meetings.

Free market

It is known that Ukraine since the end of November, 2015 doesn't buy gas from Russia. After the victory of “Naftogaz of Ukraine” over “Gazprom” in the Stockholm arbitration, the Ukrainian holding announced the possibility of resuming fuel imports from Russia and even made an advance payment for the upcoming delivery. However, the Russian monopolist at the last moment refused to fulfill its obligations, reasoning with the lack of an additional agreement to the contract between the parties.

The natural gas market has been operating in our country for 3.5 years, which means that any company can supply gas to Ukraine, as well as sell it on the domestic market. So, according to Andrii Herus, fuel is imported by "several dozen traders", and therefore, if Yuriy Boyko and Viktor Medvedchuk "agreed on a gas price (in Russia), they should immediately put these agreements on paper, sign a contract."

Moreover, gas supplies to Ukraine by private companies were carried out before the liberalization of the market. Thus, since the 1990s, the import of Russian and Central Asian gas has been carried out by the Corporation "Unified energy systems of Ukraine" (UESU), co-founded by Yulia Tymoshenko. Also, the Russian company ITERA supplied gas to Ukraine (since 2013, it came under the full control of the state “Rosneft”).

In this context, it is worth to recall the company "RosUkrEnergo", in which a prominent role was played by the now disgraced oligarch Dmytro Firtash (the company was for 50% owned by the Russian "Gazprom", and the other 50% - by Firtash and Ivan Fursin in shares of 90% to 10%). This company was an intermediary in gas supplies to Ukraine in 2004-2009.

However, the gas business in Ukraine until recently was extremely opaque. And the activity of “RosUkrEnergo” became the apogee of this opacity.

In the footsteps of "RosUkrEnergo".

The experts interviewed by “Apostrophe” believe that the situation in which a private company, including one related to Viktor Medvedchuk and Yuriy Boyko (do not forget that the latter previously held the positions of head of “Naftogaz of Ukraine” and Minister of fuel and energy), can supply Russian gas to Ukraine, is real.

"Theoretically, everything is possible in this life, but the question is, why do they need it (Medvedchuk and Boyko)? How will they benefit from it?" the expert of the program "Energy" of Ukrainian Institute of the Future Andrian Prokip said in comments to "Apostrophe". According to him, "negotiations" on gas were necessary to leaders of "Oppositional platform – For life" before parliamentary elections which took place on July 21 to show to the electorate the "real actions" (it should be noted that these "visits" in a certain degree promoted growth of a rating of party, - "Apostrophe"), but "elections passed".

But if such deliveries were established, and the Russian President Vladimir Putin and the Head of “Gazprom” Alexei Miller said about the possibility of a discount on the price at 25% - this would have collapsed prices on the Ukrainian market.

Experts believe that the situation in which a private company related to Viktor Medvedchuk and Yuriy Boyko can supply Russian gas to Ukraine is real.

The Director of special projects of the scientific and technical center "Psyche" Hennadii Riabtsev also sees no obstacles to the supply of gas to Ukraine by a potential company of "Boyko-Medvedchuk". In a conversation with “Apostrophe”, he agreed with the idea that the emergence of certain volumes of relatively cheap gas in Ukraine could significantly affect the situation on the market. It is no secret that direct gas supplies from Russia would be cheaper than from the Western direction - at least because the route of its delivery is much shorter. Now Ukraine, in fact, overpays for gas, giving traders the opportunity to make good money on the resale of the same Russian gas.

Riabtsev did not rule out that the option of such supplies can now be seriously considered.

"This is possible, especially if you make it properly. For example, if the supply will not go from "Gazprom", but from some Swiss company," the expert said.

President of the Center for global studies "Strategy XXI" Mykhailo Honchar also believes it is possible to create a private trader of Boyko and Medvedchuk for the sale of Russian gas in Ukraine.

"If we ignore the fact that Russia is an aggressor country, then yes," he said in a comment to “Apostrophe”.

The expert noted that such company can be registered not in Ukraine, but in any European country. "Boyko made his "towers" through Latvia (in 2011, Ukraine bought two drilling rigs for gas production on the black sea shelf, presumably at a significantly inflated price and through Latvian companies-gaskets. At that time, Yuriy Boyko was the head of the Ministry of energy of Ukraine, but he always denied his role in this scam, - "Apostrophe"). And here you can use Lithuania, a country that is the most solidary with Ukraine of all the EU and NATO countries," the expert said.

And it will be very similar to the already mentioned company "RosUkrEnergo" - "they will "make up" RosUkrEnergo-2".

Nothing but business?

But, as it was noted above, "RosUkrEnergo" became in due time a synonym of corruption in the gas sphere. Accordingly, should we fear the emergence of a corrupt component in the new scheme?

As it was noted by Andrian Prokip, corruption in gas issues in Ukraine has always been associated with the participation of Ukrainian officials in the "schemes". This is possible now, but given the current transparency of the market, it is quite difficult.

Hennadii Riabtsev, in turn, drew attention to the fact that the Russian authorities, in fact, monopolized the supply of energy to Ukraine. "Oil products, liquefied gas, coal are supplied here only by those companies that have good relations with the Kremlin. And I do not think that there will be any mediator who will work without the knowledge of Moscow," he said.

However, in Russia, even "strategic" projects have long been associated with corruption at literally all levels of the notorious vertical of power. Even money allocated to the "Holy of holies" - the state propaganda, is shamelessly stolen. Even the Kremlin's total bribery of European odious parties in order to undermine the situation in the European Union is not without kickbacks. The most recent example is the scandal in Italy, associated with the possible financing of the Russian party "League" for tens of millions of dollars. The most "piquant" in this scandal is that the Russian representatives during the discussion of the "deal" insisted on the return of a small amount of the proposed financing. Therefore it is impossible to exclude that in the gas scheme there will be no place for "modest" kickback.

As it was noted above, "RosUkrEnergo" became in due time a synonym of corruption in the gas sphere

"No one has gone anywhere, and the actors are almost the same. There is even a fellow, which under the old scheme can be revived, and instead of Firtash there will be Medvedchuk – it is even better. And Boyko even "was making up", "RosUkrEnergo" (Yuriy Boyko and Dmytro Firtash had a personal and presumably a business relationship, - "Apostrophe")," Mykhailo Honchar summed up. He recalled that this year, after a long break, Russia resumed purchases of Turkmen gas, which, as in the case of "RosUkrEnergo", can be used in the new supply chain to Ukraine.

But the resumption of Russian gas supplies may carry other risks. Andrian Prokip believes that for the Kremlin such a scheme "would have a certain political implication" in order to obtain "political benefit".

Mykhailo Honchar could not agree more. According to him, when Russia offers something that looks like pure commerce, it is not so. "Even if we proceed from the purity of the intentions of the current ruling team (in Ukraine), how much can they beat (the Kremlin)?"- the expert asks a rhetorical question. According to him, Russia for its cheap gas will seek not only to return to the Ukrainian market, but also "will put forward a number of political conditions." At the same time, Medvedchuk and Co will willingly "help" in the implementation of this scenario, and the presidential team may simply not see the hidden risks in time.

"Expensive" politics

Perhaps we should once again pay attention to the fact that the Kremlin in the "negotiations" with Medvedchuk and Boyko offers a discount on gas in the amount if 25%. The fact that this message pursued electoral goals has already been confirmed above. But maybe there's more to it. After all, no one forces traders to sell their goods – in this case, gas – at prices significantly below the market. Of course, the low purchase price gives the seller a good advantage. But selling goods at a competitive price the trader still gets super profits. Where can these funds be directed?

Viktor Medvedchuk, after leaving the position of the Chief of staff of President Leonid Kuchma in 2005, fell out of public policy for more than 10 years, although, according to various sources, he continued to influence it. At the end of 2013, when the then President of Ukraine Viktor Yanukovych tried to make a geopolitical "turn" from European integration towards Russia (which, as you know, led to the "Maidan" and the flight of Yanukovych from Ukraine), there were rumors that Russian President Vladimir Putin pushes the appointment of his fellow to the position of the Prime Minister. But it is difficult to answer whether it's true or not. Even the odious government of that time did not dare to take such a step, rightly fearing mass protests (although they still occurred).

Oddly enough, the partial return of Medvedchuk to public policy occurred in recent years, when Petro Poroshenko was in power. According to various journalistic investigations, Medvedchuk is behind the supply of energy from Russia to Ukraine, although he categorically denies it. He also joined the negotiating group for the settlement of the conflict in the Donbass, participated in the exchange of prisoners with Russia. At the same time Medvedchuk quietly flies a plane from Kyiv to Moscow directly, although officially there is no air service between Ukraine and Russia today.

But probably the main "achievement" of Medvedchuk during the years of Poroshenko's presidency was the acquisition of several Ukrainian TV channels. We are talking about "112-Ukraine", NewsOne and ZIK (the latter entered the orbit of "Putin’s fellow" after the inauguration of the current President of Ukraine Volodymyr Zelensky. However, it is clear that all the preparatory work on the transaction was carried out long before that). Formally, the owner of the TV channels is the closest ally of Viktor Medvedchuk the MP Taras Kozak. But no one has any doubt who is their true master.

Television, especially when it is used as an instrument of political influence, is a costly, often unprofitable business. Medvedchuk is a well-off person, but infusion into the channels number in the millions, so the additional funds are never redundant. It is impossible to say that the profit from the sale of Russian gas will be directed to finance the mentioned TV channels today, at least because there are no supplies yet. But, if the financing scheme of the Italian party "League" was allegedly carried out through oil supplies, why can’t "gas scheme" work in Ukraine?

Under the pressure of the public Petro Poroshenko at the very end of his cadence instructed the Security Service of Ukraine (SSU) to check information about possible threats to national security from "112 Ukraine" and NewsOne. However, today the TV channels continue to operate smoothly. It is quite clear that now the President Zelensky is occupied with other issues, but, probably, soon he will pay attention to the Media Empire of "Putin’s fellow" which he will instruct the Security Service of Ukraine to check, including, regarding sources of financing.