Gazprom says halts Ukraine gas deliveries over Kiev non-payment

Poland currently sources about two-thirds of its gas from Russian energy giant Gazprom, but the 900-kilometre long Baltic Pipe project is due to be pumping gas to Poland via Danish territory by 2022, when Warsaw's contract with Gazprom ends (AFP Photo/ERIC PIERMONT)

Moscow (AFP) - Russian state giant Gazprom on Wednesday said it had halted gas deliveries to Ukraine after Kiev failed to make upfront payments for more supplies.

Gazprom chief Alexei Miller said that as of 0700 GMT Ukraine's Naftogaz had used up all the gas it had paid for and "no new upfront payment has been made".

"As such, deliveries have been stopped until the receipt of new payments from the Ukrainian company," Miller said in a statement.

"The refusal to buy Russian gas will create serious risks for the reliable transit of gas to Europe through Ukraine and for the supply of gas to Ukrainian consumers during the upcoming winter," Miller warned.

Russia and Ukraine -- locked in a bitter feud since Moscow's annexation of Crimea in March 2014 -- have been involved in a festering gas pricing dispute that has seen supplies repeatedly cut off.

Moscow turned the taps back on in October under a deal that saw Kiev switch to a pre-payment system, meaning that cash-strapped Ukraine must stump up money in advance to cover Russian gas deliveries.

Some 15 percent of the gas used in Europe travels through Ukraine, and the EU has been involved in mediating the dispute between the two sides.

Gazprom's announcement comes as tensions between Moscow and Kiev have risen again over the annexed Crimea peninsula after explosions in Ukraine cut electricity supplies to most of the territory and Kiev ordered a halt to goods deliveries.

The tensions over Crimea come despite a dip in fighting in the conflict in the east of Ukraine, where pro-Russian rebels have agreed a shaky ceasefire deal with government troops.