Azerbaijan LNG Deal Boosts Ukraine’s Energy Leverage

Azerbaijan LNG Deal Boosts Ukraine’s Energy Leverage

The perennial standoff between Ukraine and Russia over natural gas prices will be accompanied by an added wrinkle this year, with news that Ukraine plans to ink a deal for a joint venture with energy-rich Azerbaijan for supplies of liquefied natural gas (LNG). The partnership, which will finally introduce unconventional energy sources to Ukraine, underscores the flagging fortunes of Russia’s pipeline monopoly and the dwindling leverage it commands.

According to Vladislav Kaskiv, the head of Ukraine’s State Agency for Investment and National Projects, the formal announcement between Baku and Kiev for the arrangement will be made later this month at the World Economic Forum gathering in Davos, Switzerland.

“According to our expectations, a number of documents on gas supplies [to the LNG terminal currently being built in Ukraine] and the creation of the Azerbaijani-Ukrainian company on gas supplies are to be signed in Davos,” said Kaskiv. “Relevant documents have been initialed, and they are just waiting for the official start of implementation.”

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