Business news from Ukraine

NOMINATION FOR GAS TRANSIT VIA UKRAINE ON MARCH 2 STILL HIGH

The first published nomination for gas transit across Ukraine on March 2 is 108.8 million cubic meters, according to Gas Transmission System Operator of Ukraine data.
In other words transit capacity utilization will again be high. The nomination is adjusted throughout the day and that for Monday is currently 109.3 mcm.
European buyers have requested more gas from Gazprom after sanctions against Russia sent gas prices soaring: gas is trading at $1,332 per thousand cubic meters at the TTF hub.

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PMS OF SLOVAKIA AND UKRAINE DISCUSS GAS SUPPLIES

Prime Minister Denys Shmyhal has discussed the possibility of increasing natural gas supplies to Ukraine through the territory of Slovakia with Prime Minister of Slovakia Eduard Heger.“Slovakia is one of the main partners of Ukraine in the energy sector. Today, we have discussed the possibility of increasing natural gas supplies to Ukraine through the territory of Slovakia. This can happen in accordance with the agreements of the gas transmission system operators of our countries,” Shmyhal at said a joint briefing with Heger in Zakarpattia region on Friday.In addition, he said that in the transport sector, an important component of cooperation could be the provision of rail container traffic on the Asia-Europe route.Shmyhal announced Ukraine’s interest in increasing additional freight traffic through the country. “A promising area of cooperation is the creation of multimodal logistics terminals for handling cargo at the Ukrainian-Slovak border,” he added.The parties also discussed the development of border infrastructure, in particular, the functioning of joint checkpoints and joint customs control.“Cooperation with Slovakia in the customs sphere is no less important for us. We are working on mutual recognition of the results of customs control,” he added.The Prime Minister of Ukraine said that in the near future the dates of the meetings of the Ukrainian-Slovak Commission on Economic, Industrial, Scientific and Technical Cooperation, the Commission on Cross-Border Cooperation and the Commission on National Minorities will be determined.Shmyhal also thanked Slovakia for supporting the sovereignty and territorial integrity of Ukraine.

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GAS TRANSIT THROUGH UKRAINE’S GTS DOWN BY 21%

Transit of natural gas through the gas transmission system (GTS) of Ukraine in January-October 2021 amounted to 35.3 billion cubic meters, which is 21.6% less than in the same period of 2020 (45 billion cubic meters), and 56.7% less than in ten months of 2019 (81.5 billion cubic meters), according the Gas Transmission System Operator of Ukraine (GTSOU).
In particular, in the western direction 32.456 billion cubic meters of gas were supplied by transit (to Slovakia – 22.43 billion cubic meters, to Hungary – 6.799 billion cubic meters, to Poland – 3.227 billion cubic meters); in the south direction – 2.833 billion cubic meters were supplied (to Moldova – 2.439 billion cubic meters, and to Romania – 394 million cubic meters).
In October, transit amounted to 2.634 billion cubic meters, which is 19.1% less than in September due to the cessation of gas supplies to Hungary via the Ukrainian route by Gazprom. In particular, in the direction of Slovakia, transit amounted to 2.117 billion cubic meters, Poland – 342 million cubic meters, and Moldova – 176 million cubic meters.
The GTSOU notes that according to the results of booking the capacities of the Ukrainian GTS on the RBP and GSA platforms for October 2021, Gazprom not only did not book the additional transit capacities, but also significantly reduced the use of the booked annual capacities, since no applications for transit of Russian gas to Hungary were received from October 1.
As a result, the average daily volumes of Russian gas transported through the territory of Ukraine in October fell to 86 million cubic meters, which is below the minimum volume under the current transit agreement (110 million cubic meters).
“We are concerned about the reduction in transit of Russian gas through the Ukrainian route: since October 1, the volume of pumping has been lower than the booked capacity. Although since November 1, transit to Moldova has increased thanks to a new contract for the supply of gas from the Russian Federation, however, the overall use of the Ukrainian GTS capacity for transit of Russian gas continues to decline: on average, at the beginning of November, it was 60 million cubic meters per day,” GTSOU Director General Serhiy Makogon said.

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MOLDOVA CALLS TENDERS TO BUY GAS FROM UKRAINE AND ROMANIA

Moldovan state company Energocom has announced a series of tenders to buy natural gas with delivery from the border with Ukraine (Oleksiyivka) or Romania (Ungheni).
The gas purchases are being made for Moldova due to the “exceptional situation,” the company said on its website.
“Following the National Commission for Exceptional Situations of October 13, 2021, the state of alert was announced regarding the natural gas sector. Energocom, a company 100% owned by the State of Moldova, is preparing to purchase natural gas to be supplied at Moldovan border from Ukraine and/or Romania,” the company said.
Tenders will be held for various periods, to begin with short-term gas purchases of 5 million cubic meters and potentially more for the balance of October, Energocom said.
Gas suppliers must have “a proven record of reliable and professional activity (gas supply license in at least one EU/Energy Community country and >0.3 bcm of gas trading in 2020), the company said.
The first tender to purchase 1 mcm of gas was announced on October 23. Prepayment will be issued immediately, but SWIFT transfer to foreign entities can only be carried out on Monday, October 25, Energocom said.
“Considering the emergency situation, the Public Property Agency of Moldova, the sole shareholder of Energocom, will issue a comfort letter to the selected suppliers to confirm that payments will be duly made,” the company said.
The Energy Community Secretariat held a meeting with a delegation from Moldova to discuss problems with gas supplies to the country.

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EUROPEAN COMMISSION’S PRESIDENT: UKRAINE MUST REMAIN GAS TRANSIT COUNTRY

Ukraine should remain a gas transit country, President of the European Commission Ursula von der Leyen said at a press conference in Kyiv.
“It is clear and constant for the European Commission Ukraine is and must remain reliable gas transit country,” the European Commission’s president said.

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MIKHAIL FRIDMAN PREDICTS STABILITY OR GROWTH IN GAS DEMAND IN FUTURE

The downward trend in non-renewable energy sources is very strong and it will progress, but the demand for natural gas will remain or even grow in the next decade, Mikhail Fridman, founder of LetterOne, shareholder of Alfa Group Consortium, has said.
“Gas is likely to rise rather than fall in the next decade,” he said at the Kyiv International Economic Forum on Thursday.
Fridman added that the share of alternative energy will also grow, helped by government incentives and worsening conditions for carbon sources.
At the same time, according to his forecasts, despite the strong trend against non-renewable energy sources, the change in the structure of energy generation will not be very rapid.
“It is frivolous to say that everything will happen very quickly – it is irresponsible,” the businessman said.
In such an environment, Fridman believes, oil and gas companies will not be popular, but they will exist for a long time and actively invest in carbon neutrality.
“They will be arranged like a tobacco industry,” the shareholder of Alfa Group said.

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