The creation of the joint venture was a key part of a deal that ended a Russian-Ukrainian dispute over gas prices last month.
The joint venture, UkrGazEnergo, was set up between Ukraine's Naftohaz state energy company and an intermediary company RosUkrEnergo.
The Swiss-registered RosUkrEnergo has been criticized for lack of transparency as it is equally owned by Gazprom, Russia's state-controlled natural gas company and a group of investors whose names have not been made public.
Aleksandr Ryazanov, deputy chairman of Gazprom, was elected to chair the new joint venture's supervisory body.
According to a Naftohaz spokesman, the new joint venture will sell Russian and Central Asian gas to Ukraine at the price of $95 per 1,000 cubic meters over the next five years.
(Ukrayinska pravda, Interfax-Ukraine, ITAR-TASS)
Gas Facts
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- Ukraine consumes 70 billion cubic meters (bcm) of gas per year. It produces 20 bcm of its own gas, has a signed contract to import 40 bcm from Turkmenistan, and in 2005 was getting 29 bcm from Russia as payment for transit of Russian gas.
- Ukraine sells some 7 bcm of gas a year to the West and places some in underground storage facilities. These facilities can hold 34.5 bcm.
- Ukraine is the sixth-largest consumer of gas in the world and uses more gas than Poland, the Czech Republic, Hungary, and Slovakia combined.
- Russia has proven gas reserves of 47 trillion cubic meters (tcm) -- the largest in the world ahead of Iran and Qatar.
- Russia sells approximately 160 bcm to Europe each year. By 2015, Europe is expected to import 300 bcm, or 40 percent of its projected needs from Russia.
- Russia's Gazprom is the world's largest gas company. It is the only company allowed by Russian law to export gas outside the borders of the CIS. It also owns the gas-transportation system and most of the gas fields in Russia.
- The Russian state is Gazprom's majority shareholder , with a 51 percent share. The company's ownership rights changed as of the beginning of 2006, with Gazprom stock being sold on the open market. The Russian state, however, will continue to hold the majority stake.