Page 11 - FSUOGM Week 42 2019
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FSUOGM PIPELINES & TRANSPORT FSUOGM
Ukraine to tap more gas from Poland
UKRAINE
Ukraine is looking for options ahead of the expiry of its gas transit deal with Russia.
UKRAINE, which is scrambling to safeguard against potential gas supply risks this winter, has upgraded a compressor station in order to ramp up gas deliveries from neighbouring Poland.
The modernisation of the Komarno station in Ukraine’s western Lviv region enables Ukraine to pump up to 6.6bn cubic metres per year of Polish gas, Ukraine’s state gas company Naftogaz said on October 16. Flow tests are scheduled to take place later this month.
Ukraine has been buying gas from Poland, Hungary and Slovakia for five years, allowing it to forgo purchases from Russia. Polish annual shipments have typically ranged from 3.3 to 3.5 bcm. In reality, most of this gas has still originated from Siberia but has been resold to Ukraine by Polish suppliers.
However, Ukraine has also obtained some US gas from Poland’s 5 bcm per year Swinoujs- cie LNG terminal, launched in 2015. Ukraine is eager to expand these purchases.
According to Naftogaz, now that the Komarno station has been upgraded, the onus is on its Polish partners to complete similar investments in order to increase supply. This includes the construction of an internal pipe- line in Poland, removing a bottleneck and
expanding Swinoujscie LNG’s import capacity to 7.5 bcm per year. Both projects are set to fin- ish in 2021.
Ukraine is fearful of possible supply shocks next year, if it is unable to agree new terms for Russian gas transit after its existing con- tract with its neighbour expires on January 1. Ukraine has not bought any gas directly from Russia since 2016. But a disruption to transit would still affect its supply, as Ukraine uses some Russian gas to cover demand in its east- ern and central regions, swapping this for gas stored elsewhere.
Were Russia unable to provide contrac- tual supply volumes to its customers in eastern Europe using a different route, this would also limit how much gas they had spare to sell to Ukraine.
In its statement, Naftogaz also pointed to the benefits to European traders of removing bottlenecks in Poland, inviting them to make use of up to 10 bcm of its gas storage capacity, which is mostly located in the west. Storing gas in Ukraine will allow traders to stock up on supplies when prices are low in the sum- mer and re-sell them in winter, when rates are higher.
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