Page 16 - FSUOGM Week 30 2022

FSUOGM NEWS IN BRIEF FSUOGM

making more sanctions concessions. accepted a plan to reduce gas demand by three years and its European friends will be
Gazprom is reportedly asking the EU to lift 15%, but we think this is mostly a political short of gas themselves this winter.
sanctions on all its imported equipment gesture, as $2,200/mcm gas prices now
needs. and outright shortages (and likely even
“The issues are much more complex than higher prices) come winter will achieve Iran aims to team up with
just turbine overhauls: This situation with this on their own without bureaucratic
gas flows – not just via Nord Stream but also intervention.”. Russia for $60bn Oman
through the Yamal-Europe line via Poland
and via Ukraine – has long since left the and Pakistan gas pipeline
realm of operational issues and entered that Ukraine appeals to US for
of political considerations. All sides have project
taken decisions based on priorities other gas supply
than purely economic in nature,” BCS GM Iran intends to implement a $60bn project
said, listing the main issues: Ukraine has requested gas from the US as to export gas to both Oman and Pakistan
Ukraine’s decision to disallow the the country prepares for its “most difficult with Russia, official energy news agency
entrance of Russian gas via the Sokhranovka winter”, the Kyiv Independent reported on SHANA reported on July 27.
entry point in mid-May; July 27. A deal for the undersea pipeline part
Poland sanctioned Gazprom, blocking Ukraine’s gas storage tanks are at of the project, which would transit gas
it from receiving dividends from EuRoPol the lowest level in Europe and are only to Oman's Musandam province at a
GAZ, a joint venture with Poland’s PGNiG filled to 22% of capacity, causing serious minimum rate of 28mn cubic metres per
running a section of the Yamal-Europe line; concerns for the coming heating season. day, was signed with the Omanis back in
Russia responded by ordering Gazprom As European countries scramble to fill 2013. The project was also configured to
to halt shipments via Yamal-Europe; and their own tanks after Gazprom reduced gas encompass a second pipeline that would
Canada decided to disallow the return of flows to 20% this week, Kyiv has appealed cross Iran's southern border into Pakistan.
the overhauled Siemens turbine to Russia, to the US. The project failed to progress but an
despite the fact that existing pipeline “The appeal of the Government of agreement to revive it was reached in May
projects had been explicitly excluded from Ukraine to the Government of the United when Iranian Oil Minister Javad Owji
sanctions regimes. States of America regarding the granting visited Muscat. It was then placed on hold
“As the core problem is political, the of a "gas lend-lease" to our state for a due to cost disagreements.
solution will also have to be political, stable heating season was approved,” Owji made the announcement that
and thus it is beyond the scope of mere Prime Minister Denys Shmyhal wrote on Russia was to be brought into the project
economic or operational analysis,” BCS GM Telegram. amid a tightening of trade and investment
said. The “gas lend-lease” references the and political relations between Tehran and
Now Europe is facing the possibility of 2022 US Lend-Lease Act, implemented Moscow, with the need of both the Iranians
being cut off from gas imports from Russia in response to the Russian military and the Russians to sidestep Western
during the winter, which will cause its aggression, that enhances the US sanctions now a driving factor in bilateral
economy to contract by 2-3%, according President’s power to provide military aid to economic talks.
to a recent International Monetary Fund Ukraine, the Kyiv Independent noted. "Given the negotiations with the
(IMF) study. The EU launched a voluntary With fears growing about the Russian state corporation Gazprom and
deal on July 26 for the members to reduce autumn and winter, Ukrainian President the memorandum concluded with it, it was
their gas consumption by 15% between Volodymyr Zelenskiy mentioned last decided to jointly implement a project to
August and March in an effort to save gas month that Ukraine will not sell any gas supply gas to Oman and Pakistan," Owji
ahead of the winter. and coal abroad but rather save it for was quoted as saying.
In the meantime, European companies domestic use to prepare for the winter Gazprom and the Iranian National
continue to refill their tanks from the period. Oil Corporation (NIOC) signed a
reduced Nord Stream 1 flows, via Ukraine The government also ordered Naftogaz memorandum of understanding on
and also the TurkStream pipeline, which has to ask bondholders for a two-year payment cooperation during Russian leader
been unaffected. freeze on $1.4bn of its bonds earlier this Vladimir Putin's recent visit to Tehran.
“Despite the sharp slowdown of Russian month, citing the need to preserve money It covers projects in Iran estimated at
gas flows, Europe is meeting its targets for to buy gas. around $40bn, including the development
refilling storage ahead of winter, mostly In the normal course of things, Ukraine of the Kish and North Pars gas fields, the
on the strength of record LNG imports has enough gas to last until the middle of pressurisation of the South Pars field,
attracted by the astronomical price for March 2023. But if deliveries are cut off the development of six oil fields, the
gas,” BCS GM said. “However, just meeting tomorrow, gas will run out on October completion of liquefied natural gas (LNG)
ordinary gas storage levels will not ensure 29, or at best the end of November if the projects, gas and derivatives swaps, the
a fully-supplied winter, if Russian flows are autumn is mild. Ukraine is very likely to construction of gas export pipelines and
not available in full at least through Ukraine have an energy crisis this winter, as it has scientific and technical cooperation.
and Nord Stream. Europe has meanwhile not imported gas from Russia for over

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