Putin Talks Peace With Ukraine’s Leader After Gas Pipeline Blaze

The Russian and Ukrainian presidents
discussed a possible cease-fire for southeastern Ukraine hours
after a pipeline fire blamed by the government in Kyiv on
sabotage threatened natural gas flows to Europe.

Presidents Vladimir Putin of Russia and Petro Poroshenko of
Ukraine talked last night about bilateral relations between the
countries and about the death of Russian journalists working in
Ukraine, according to a Kremlin statement.

“The issue of possible cease-fire in the area of a
military operation in Ukraine’s southeast has been touched
upon,” the Kremlin said after the leaders’ phone call.

Putin and Poroshenko spoke a day after Russia cut gas
supplies to the Ukraine over unpaid bills and demanded advance
payments from its former Soviet Union ally. The gas dispute has
stoked tensions between the two governments as Ukraine battles
pro-Russian insurgents in its eastern region.

Ukraine’s Interior Ministry blamed “terrorism” as the
likely cause of the fire at the Urengoy-Pomary-Uzhgorod link in
the central part of the country. It was the second pipeline fire
in six weeks.

“Local residents reported hearing two strong claps that
may indicate deliberate explosions,” Interior Minister Arsen Avakov said in the statement, blaming Russia for trying to
discredit Ukraine as a reliable “partner in the gas sphere.”

The blaze was detected at about 2:20 p.m. local time, with
flames shooting as high as 100 meters (330 feet), and emergency
workers extinguished the blaze about two hours later, according
to state pipeline operator UkrTransGas. Flows to Europe weren’t
affected. About 20 kilometers of the pipeline were sealed off,
with shipments redirected to a parallel section.

Increased Security

Ukrainian officials said they will boost security along the
entire network to guard against any future attacks. The Urengoy-Pomary-Uzhgorod system has a capacity to carry about 28 billion
cubic meters of gas a year, while Ukraine can send as much as
142 billion cubic meters of Russian gas annually to central and
western Europe.

“It is a very alarming situation and a very strange
coincidence,” Naftogaz CEO Andriy Kobolyev said on his Facebook
page. “We will do everything possible” to boost security
across the system, he said.

The Interior Ministry foiled two attempted attacks on
pipelines before Ukraine’s May 25 presidential election,
according to Avakov. Those attacks were designed to
“discredit” Ukraine as a reliable transit corridor and
“promote” Gazprom’s South Stream project to export gas through
the Black Sea to Bulgaria and beyond, circumventing Ukraine,
Avakov said.

Journalists’ Deaths

Amid the dispute over gas, Russia condemned Ukraine over
the death of a state-television reporter killed by mortar fire
in the violence-torn east area of the country, adding to tension
between the two neighbors.

Russian Prime Minister Dmitry Medvedev said there are
people who are “guilty” for the death yesterday near Luhansk
of Igor Kornelyuk, a correspondent for Russian State Television
and Radio Broadcasting Company. Sound producer Anton Voloshin
was found dead later, the Interfax news service reported, citing
separatist forces.

“Those who call themselves the authorities in neighboring
Ukraine answer for the situation there and it’s in their power
to halt the bloodshed,” Medvedev said on his Facebook account.

During his call last night with Poroshenko, Putin expressed
concern over the journalists’ deaths and called on the Ukrainian
government to guarantee the safety of members of the media
working in the region.

Investigation Ordered

Poroshenko has ordered law enforcement officials to
investigate the deaths. The Organization for Security and
Cooperation in Europe, which has tried to broker a peace plan,
had also called for a probe of the incident.

The deaths came three days after an attack by protesters on
the Russian embassy in Kyiv following the shooting down of a
Ukrainian military plane by the rebels, which killed all 49
people on board.

Poroshenko discussed his proposal for a cease-fire with
German Chancellor Angela Merkel yesterday, his office said in a
statement. The proposal envisions the creation of a 10-kilometer
buffer zone on the Ukrainian border with Russia, the withdrawal
of insurgent groups, the return to Ukraine’s government of
seized buildings and the decentralization of power.

Russia has as many as 38,000 soldiers on Ukraine’s borders
and continues to supply arms and personnel to rebel forces in
the eastern part of the country, Ukraine’s National Security
Council chief, Andriy Parubiy, said June 16.

There are about 16,000 troops on Ukraine’s eastern frontier
and another 22,000 in Crimea, the Black Sea peninsula that
Russia annexed from Ukraine in March, Parubiy said.

The number of militants in Luhansk and the neighboring
Donetsk region is about 15,000 to 20,000, half of whom are from
Russia, including special forces, Parubiy said.

Igor Konashenkov, a spokesman for the Defense Ministry in
Moscow, declined to comment on Parubiy’s assertions.

To contact the reporters on this story:
Volodymyr Verbyany in Kyiv at
vverbyany1@bloomberg.net;
Elena Mazneva in Moscow at
emazneva@bloomberg.net;
Anastasia Ustinova in Chicago at
austinova@bloomberg.net

To contact the editors responsible for this story:
Balazs Penz at
bpenz@bloomberg.net
Michael Shepard, Don Frederick