2.4.7. Debt Problems and Discontinued Supply in 2005

In May of 2001, Turkmenistan and Ukraine signed a contract for 2002–2006 for the delivery of 40 bcm in 2002, 50 bcm in 2003, and total expected delivery of 250 bcm until 2010 [34,35]. The agreed price was \$42/1000 m3, with 50% in barter. In October of 2002, the parties settled on a price of \$44/1000 m3 for 2003 (50% barter) with 36 bcm to be delivered that year.

During 2003–2004, Ukraine failed to make timely payments to Turkmenistan, adding new debts to old ones. After several warnings, Turkmenistan cut the supply of gas to Ukraine (and to Russia) on 31 December 2004, and requested a higher price of \$60/1000 m<sup>3</sup> for supplies in 2005. Turkmenistan resumed exports to Ukraine on 3 January 2005 at \$58/1000 m3, paid 50% in barter [34,35].
