The EU authorities are studying the possibility of placing gas reserves in storage facilities in Ukraine.
Source. Bloomberg
European officials plan to prevent a shortage in the winter, when their own reserves will decrease, and to avoid an oversupply in the coming months, analysts told the agency.
"Ukrainian storage facilities can help balance supply and demand in the second half of summer 2023 given their good connection to EU gas markets," German company RWE said in a statement. Last year, it used Ukrainian storage facilities.
At the same time, such a partnership could provide Ukraine with much-needed revenue after the russian invasion and strengthen ties with the EU.
Located 2 km underground, Ukrainian gas storage facilities can hold more than 30 billion cubic meters of gas. "Ukrtransgaz is ready to provide a third of this capacity, which is equivalent to 10% of EU demand in the fourth quarter of last year.
In addition, Ukraine offers gas storage at a fixed rate, which is a very attractive and competitive option, said Marco Saalfrank, head of trading operations at Swiss concern Axpo.
The European Commission is "examining whether and how guarantees issued by public institutions can facilitate access to natural gas storage in Ukraine," said Tim McPhie, an EC spokesman.
"Ukrtransgaz, for its part, is working on implementing service guarantees to reduce the risks associated with hostilities, the company representative said.
Last year, russia declared a gas war on the EU countries. Even before the explosion at the Nord Stream pipeline, Gazprom had significantly reduced gas supplies to the EU.
"Europeans will be fiercely cold in their homes," and gas will cost 5,000 euros per thousand cubic meters," promised Dmitry Medvedev, deputy head of the russian Security Council, last summer. However, at the end of the heating season, storage facilities in the EU were 61.4% full, and traffic jams were forming in ports due to the excess of LNG.
"russia played the energy card, but lost," Fatih Birol, Executive Director of the International Energy Agency (IEA), stated on May 22.
Background. Meanwhile, the German Minister of Economy said that the country faces the threat of industrial shutdown if russian gas transit is stopped.