22/10/2014 Ukraine: Daily Highlights - Ukraine takes steps to strengthen energy security

22/10/2014 Daily Highlights from “Digests & Analytics Ukraine” News Agency

Situation in eastern Ukraine remains tense, number of Russian military units increase in the region, probability of an active campaign is quite high. Russia blocked the extension of control over the border by the OSCE mission. The government is busy with issues of energy security and increasing generation of electricity without the use of natural gas. The heating season started earlier than planned.

Ukraine

• The Government decided that military service in the combat area will be counted three folds against the regular service terms.
• Poroshenko president held an emergency meeting with the heads of security and power agencies. No details of the meeting were disclosed.
• As said by one of the Ukroboronprm managers Pinhas, the concern will soon start working according to the NATO standards.
• First ship with coal from South African Republic arrived to Illichyvsk port. A contractual agreement with a Polish exporter is being planned as well. Supplies of the energy coal from abroad are necessary due to the loss of coal mines in Donbass, which have been seized and destroyed by terrorists.
• Ukraine significantly increased electricity production. Prime Minister Yatsenyuk said that the Government plans to construct additional nuclear reactors without engagement of Russia, as well as plans partial substitution of natural gas with fuel oil in the thermal power stations.
• The Government launched the heating season. The use of gas from the underground storage facilities started.
• As a result of the trilateral gas negotiations in Brussels, Ukrainian Energy Ministry declared readiness to pay off gas debt to Russia at a price that was in force during the first quarter of 2014 and adoption of a temporary price for the winter season for gas purchases from Gazprom. Russian Energy Minister Novak confirmed that the start of the debt repayment is the condition for beginning of gas supplies to Ukraine.
• Deputy Head of the Presidential Administration Schimke said that part of the reform department implemented electronic document and will lay off 80% of employees.
  Deputy Head of the Presidential Administration Shymkiv said that electronic document management has been introduced within the framework of the state authorities reform, and that 80% of Presidential Administration employees will be laid off.
• Official exchange rate of the National Bank hasn’t practically changed: 12.95 USD/UAH, 16.52 UAH/EUR (-2 cop), 3.15 UAH/10 RUB (-2 cop).

Kyiv

• The first public auction for the sale of land did not achieve its objectives.

War in Ukraine

• The intensity of the fighting in the conflict zone under the conditions of the declared "artillery silence" has slightly decreased, but the battle for Donetsk airport and shelling of the Ukrainian army positions did not stop.
  As evidenced by witnesses from various towns in Donetsk and Luhansk regions, Russian army is deploying additional strike, intelligence and paratrooper units, artillery and armored vehicles to Ukrainian territory.
• During the OSCE meeting in Vienna, Russia blocked a decision to increase the number of checkpoints on Ukrainian border controlled by the organization.
• NSDC released photos that prove the use by the Russian army of cluster munitions and multiple rocket launchers "Smerch" on Ukrainian territory.
• In Crimea, Russia started to issue foreign passports invalid in the EU. Crimean inhabitants could receive visas only in embassies of EU member states in Ukraine.

International

• The European Parliament elected a new European Commission, headed by former Prime Minister Juncker of Luxembourg.
• Ukraine could receive the third part of the macro-financial aid package should the country ensure a transparency of the budgetary policy, as mentioned by Euro Commissar Barroso.
• At a meeting in Berlin, the foreign ministers of Germany and the United States recognized that the conflict in eastern Ukraine threatens world order and Russia's actions are a violation of the sovereignty and independence of Ukraine.
• Russia is preparing for the fall of oil prices in 2015 to $ 60 per barrel.

Trends

• There are reports from the regions under the control of DPR and LPR militants of increasing Russian troops numbers, deliveries of additional equipment and ammunition, which increases the probability of a start of active hostilities in Donets in the near future, after the closure of the ferry to the Crimea.