Russia appears prepared to become involved in Ukrainian politics in order to pursue its plans for joint control of the country's gas pipelines to Europe. The industry newsletter "Petroleum Argus" reported two weeks ago that Russia is trying to create a lobby of powerful Ukrainian interests to fight political opposition to its pipeline plans.

Russian Prime Minister Mikhail Kasyanov and his Ukrainian counterpart, Anatoliy Kinakh, met in Kharkiv on 21 June to conclude a series of agreements, including a 10-year transit accord to handle Russian gas deliveries through 2012. The deal signed by Russia's Gazprom and Naftohaz Ukrayiny will allow Russia to ship at least 110 billion cubic meters of gas through Ukraine annually. Officials said prices and other terms would be settled by 1 July.

The prime ministers also pledged quick implementation of a decision reached three weeks ago by Presidents Vladimir Putin and Leonid Kuchma with German Chancellor Gerhard Schroeder in St. Petersburg to create a consortium for managing and developing the pipelines. "Special working groups will soon work through an intergovernmental agreement to bring the will of our presidents into fruition," Interfax quoted Kasyanov as saying.

Putin has said the consortium could attract $2.5 billion in investment to Ukraine for upgrading the aging pipelines and $15 billion more in the next decade for developing the gas network. Ukraine hopes the deal will also end Russia's plans to build bypass routes around the country to handle the expected growth in gas exports to Europe over the next 20 years

(RFE/RL 03.vii.02)