Russia tells EU gas supplies via Ukraine under no immediate threat
MOSCOW/KIEV, March 3 (Reuters) - Russia's Energy Ministry said on Saturday that gas giant Gazprom's intention to terminate contracts with Ukraine poses no immediate threat to natural gas supplies to Europe through Ukraine.
| Headquarters of Gazprom in Moscow (Photo: Reuters)
The issue of gas transit has intensified after the Russian group said on Friday it would end the contracts after a Stockholm arbitration court ordered it to pay more than $2.5 billion to Ukrainian energy firm Naftogaz.
Gazprom said on Saturday it had started moves to terminate gas supply contracts with Naftogaz, though Kiev said there had so far been no impact on supplies through its pipelines to Europe.
Gazprom's announcement marked an escalation in a long-running dispute between Moscow and Kiev, which has left Ukraine struggling to stay warm and which the EU has said could threaten gas flows across the continent.
Russia's Energy Minister Alexander Novak told European Commission Vice President Maros Sefcofic in a phone conversation that gas transit would not be at risk until Gazprom and Naftogaz fully terminated their agreement.
"Minister Novak assured that the gas transit from Russia to Europe is under no threat. The transit remains as reliable as in the past," the ministry said.
Gazprom deputy CEO Alexander Medvedev said on Saturday the group had begun proceedings at the same court to carry out the terminations.
"We have started the procedure of terminating contracts with Ukraine's Naftogaz," Medvedev said.
Ukraine's state-owned gas pipeline operator Ukrtransgaz said on Saturday it had had to take additional measures to ensure gas transit to European customers.
Ukrtransgaz spokesman Ihor Kravchyshyn said it had faced "a critical situation" as Russia had kept pressure at the point connecting to the Ukrainian pipeline system at a low level - at least 20 percent below that required by transit contracts.
Ukrainian President Petro Poroshenko said on Saturday Ukraine saw an increase in gas supplies from Poland, Slovakia, and Hungary, which has fully offset the impact of Gazprom's decision.
Gazprom had intended to resume gas supplies to Ukraine for the first time since late 2015 when Kiev started buying gas from Europe to try to cut its energy dependence on Moscow. But the Russian group cancelled that plan on Friday.
(Reporting by Vladimir Soldatkin in Moscow and Natalia Zinets in Kiev; Writing by Andrey Ostroukh; Editing by Andrew Bolton)
The US Energy Information Administration (EIA) reported in April that the US set records for natural gas production in 2017.
- Energy Web Atlas
Since market reforms first started in 1978, China has shifted from a centrally planned economy to a market-based economy, experiencing rapid economic and social development.
Russia aims to ally with Qatar in LNG competition with Australia and other LNG-exporting majors over the coming years.
GasPro 2.0: A Webcast Symposium
The global LNG industry is becoming increasingly interconnected as grassroots export projects get off the ground. Another technology route for processing gas into fuels—GTL—is attracting renewed attention due to improving economics. Small-scale solutions for both LNG and GTL are at the forefront of new technological developments, while major projects using more conventional technologies continue to start up around the world.
During this webcast, we will focus on LNG, GTL, gas processing technology developments and deployments, operations, small-scale solutions, transportation, trading, distribution, safety, regulatory affairs, business analysis and more.
October 25, 2018 08:30 AM CDT