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Kiev confirms plans to involve U.S. in modernizing gas pipelines

KIEV, January 15 (RIA Novosti) - The Ukrainian Foreign Ministry confirmed on Thursday Russian media reports that Kiev was planning to involve the United States in modernizing its Soviet-era gas pipeline network.

The Russian daily Izvestia reported Wednesday that under a strategic partnership charter signed between Ukraine and the United States, Washington would help the ex-Soviet republic modernize its worn-out gas pipelines.

The paper added that both Russia, which transits about 80% of its gas supplies to Europe via Ukraine, and the European Union had long been concerned over the poor state of the Ukrainian gas pipes and were prepared to invest in their repair, but Kiev had resisted outside involvement in its gas network.

"The charter indeed has provisions on the involvement of the U.S. in modernizing the Ukrainian gas transportation system. The charter stipulates specific mechanisms of energy cooperation, primarily, the start of work of a bilateral working group on energy security and a closer dialog between Ukraine, the U.S. and the EU over enhanced energy security," the ministry said.

The Foreign Ministry also said Ukraine was interested in finding investors for the modernization of its gas transportation system that would not advance any political demands and would not attempt to exert political pressure on Ukraine.

Deputy Foreign Minister Konstantyn Yeliseyev said on Wednesday Ukraine needed 2.5 billion euros ($3.3 billion) to modernize and expand its gas transportation network.

Ukraine and Russia have been embroiled in a bitter gas dispute over gas prices and a new contract on natural gas supplies, which resulted in the suspension of gas supplies to Ukraine on January 1. Russian energy giant Gazprom cut off supplies to Europe a week later saying Ukraine was stealing gas intended for EU consumers.

Following mediation by the EU, the two sides agreed to resume supplies, but deliveries have not restarted, with each side blaming the other over the impasse.