By Ron Popeski

KIEV, Oct 16 (Reuters) Yulia Tymoshenko, tipped to be Ukraine's next prime minister, said today gas company owners must be held accountable for safety as the country mourned victims of a blast that shattered an apartment building.

Tymoshenko, a former premier and key figure in an ''orange'' post-election parliamentary coalition, said companies failing to meet standards could face being turned over to the state sector.

Yesterday, she initialled an accord to form a coalition with the Our Ukraine party backed by President Viktor Yushchenko -- under which she is all but certain to get her old job back.

She said the detention of two gas company officials after the weekend blast was insufficient in tackling the problem.

''We have a tradition of finding some middle-ranking employee and offering him up as a sacrifice. In theory, it is the owners of this gas distribution system who must assume responsibility,'' Tymoshenko told a news conference.

''Either we introduce tough conditions and, if the owner fails to comply, it must be returned to the state. Or we simply pass a law returning to the state sites vital to people's lives and involving an element of danger. I do not rule out that we will have to do this.'' Yushchenko declared Tuesday a day of public mourning for victims of the blast. Flags on public buildings flew at half mast or with black trim or ribbons.

The Emergencies Ministry raised to 17 the death toll in the series of blasts that reduced to rubble part of an apartment building and hit nearby homes in Dnipropetrovsk, central Ukraine. Ten people were missing and 16 were in hospital.

Media reported two more deaths in a central Ukrainian village on Monday while trying to bring a gas boiler on stream.

Tymoshenko called for a national audit of safety standards in gas and power distribution systems and proposed calling into session the powerful National Security Council, even before the new government is formed, to take emergency decisions.

Tymoshenko was Yushchenko's first prime minister after weeks of mass ''Orange Revolution'' rallies in 2004 swept him to power.

She was sacked eight months later after her government split into two factions, ties with Russia soured and investors took fright at her calls for a review of ''dubious'' privatisations.

Tymoshenko and Yushchenko reconciled during the campaign for the election, which produced a wafer-thin ''orange'' majority of 228 seats -- two more than needed for most votes in parliament.

In Brussels, the European Union's Commissioner for External Relations, Benita Ferrero-Waldner, said the new coalition faced challenges in introducing political and economic reforms.

''The European Commission stands side-by-side with Ukraine as it continues along this path of reform,'' she said.

REUTERS RSA RN2240