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Ukraine okays international gas observers (Extra)

Jan 10, 2009, 23:20 GMT

Moscow/Kiev - Ukraine joined Russia to approve a European Union initiative for international observers to monitor Russian gas deliveries via Ukraine, raising hopes of a possible end to a Kremlin embargo on energy supplies to Europe.

Ukrainian Prime Minister Yulia Tymoshenko signed the deal early Sunday, Interfax news agency reported.

Czech Prime Minister Mirek Topolanek, whose country currently holds the EU presidency, arrived in Ukraine on Saturday evening in an attempt to get Kiev to sign a deal aimed at ending Russia's natural gas embargo to Europe.

Russian President Vladimir Putin and Topolanek on Saturday afternoon signed the agreement for EU observers on the ground to monitor the volumes of Russian natural gas moving through Ukraine.

Russia will resume gas transfers to Europe via Ukrainian pipelines immediately after EU monitors were in place to prevent Ukrainian 'gas theft,' Putin said.

The agreement would leave open the main grounds for the Russo-Ukrainian natural gas dispute: the absence of a natural gas delivery contract between Russia and Ukraine for 2009.

Conflict between Kiev and the Kremlin over contract terms in late 2008 escalated to a total Russian cut off of all gas sent into Ukraine's pipeline network, including gas earmarked for downstream European consumers.

Europe buys roughly one-quarter of its natural gas from Russia, 80 per cent of which is delivered to market via Ukrainian pipelines.