Page 119 - RusRPTSept21

9.1.1b Oil and gas sector news
In July, Gazprom cut its pipeline deliveries to the EU by 10.3 billion cubic meters due to scheduled shutdowns of the Nord Stream 1 and Yamal pipelines for planned maintenance. Rather than make up for this shortfall by sending more gas across Ukraine, Gazprom chose to draw down its German and Austrian underground storage reservoirs to dangerously low levels, says Serhiy Makogon, CEO of Ukraine’s Transmission System Operator.
“Gazprom is devastating its underground storage facilities in Europe,” the head of GTSOU pipeline company Makogon told Ukraine pipeline operator’s press service. He said Gazprom-owned reservoirs in Germany are only 13% full, compared to a national average of 63%. Similarly, in Austria, Gazprom’s reservoirs are 14% full, while the national average is 48%. Talking before the Western Siberian explosion was known, he asserted: “Gazprom is extracting gas from storage facilities to fulfill its contracts. Accordingly, the gas shortage in Europe's underground storage facilities is largely artificial.”
Gas Prices on the European gas market hit $517 per 1,000 cubic meters on August 1. This is three times the level of $170 that Gazprom used in January to calculate its 2021 budget. Energy analysts say that Gazprom is forcing up the EU gas price to pressure regulators to commission the Nord Stream 2 gas pipeline this fall.
Tightening the natural gas shortage in the EU, Gazprom has cut by 50% gas shipments through the Yamal pipeline to Poland and stopped pumping gas into underground storage facilities in Austria, Germany and the Netherlands. With EU storage at only 57.5% of normal mid-summer levels, unfulfilled demand for gas is 16 billion cubic meters, Interfax reports from Moscow, citing data of the Gas Infrastructure Europe portal.
Rosneft CEO Igor Sechin has asked President Vladimir Putin to allow the company to export gas from Russia, Kommersant reported on August 26.
Rosneft wants to export 10bcm/a through an agent agreement with Gazprom (with potentially greater deliveries in the future). The deliveries are to be made to customers which currently do not buy gas from Gazprom.
He also suggested that the company might pay taxes on these exports based on the market gas price (as opposed to the realised price). The company has estimated the potential MET rate at RUB5,000/kcm ($67/kcm), 3.5x higher than Gazprom's MET under current gas prices. This might add RUB37bn/a to the budget under the current gas prices
119 RUSSIA Country Report September 2021 www.intellinews.com