Kiev  - Ukraine's government on Friday upped the ante in its natural gas conflict with Russia, informing the Kremlin's ongoing gas shipments to Europe might well be "confiscated."

The absence of a contract between Russia and Ukraine for gas deliveries and transfers onward to Europe makes any gas shipped by Russia into Ukraine technically "of unknown origin," and so subject to confiscation by the Ukrainian government, wrote Oleh Dubina, chairman of Ukraine's Naftogaz Ukrainy gas trading company.

Dubina's letter, sent to Aleksei Miller, chairman of Russia's giant natural gas monopolist Gazprom on Tuesday, was the clearest indication yet Ukrainian officials intended to siphon natural gas shipped into Ukraine by Russia for onward transport to European customers, and held in Ukrainian underground reservoirs.

Ukraine's leading investigative Ukrainska Pravda website published the text of the letter, posted by Naftohaz to Gazprom on December 31, the last day of an effective gas transfer contract between the two countries.

Russia cut off gas supplies to Ukraine on January 1 because of slow Ukrainian payment of debt, and as a negotiating tactic. The initial Ukrainian response was to bar Gazprom auditors from inspecting natural gas levels within Ukraine, effectively taking hostage gas stored in Ukraine by Gazprom for later shipment to Europe.

As much as 4 billion cubic metres of Gazprom-owned gas - fuel worth some 16 billion dollars at prevailing European prices - are stored in Ukrainian reservoirs, according to Ukrainian energy industry estimates.

Gazprom has continued to pump another 300 million cubic metres of natural gas into Ukraine's natural gas pipeline network daily. The Kremlin has said Ukraine has no right to interfere with the shipments, but Dubina's letter disagreed, saying Russia lost title to gas pumped into Ukraine, given the absence of an existing contract spelling gas trade terms between Russia and Ukraine.

Talks between Russia and Ukraine on a new natural gas transfer contract failed on December 31, after which Russia declared Ukraine in a gas embargo.

Ukraine's counter has been to threaten that it will divert Russia's gas for Ukrainian consumers if necessary, and to call for a renewal of discussions. (dpa)