Page 10 - FSUOGM Week 35 2021

FSUOGM PIPELINES & TRANSPORT FSUOGM

Gazprom Export stops offering

2022 gas delivery on ESP

RUSSIA THE overseas supply arm of Russian gas com- metres in the first two years alone.
pany Gazprom has not been offering any deliv- Gas prices at major European hubs have
Gazprom set up its ESP ery options for 2022 on its European electronic risen above $500 per 1,000 cubic metres in
in 2018 to funnel more sales platform (ESP) since August 23, platform recent months, driven by strong demand and
gas onto the European data shows. This is likely to cause further unease increased storage injections, as supply remains
market beyond sales among market players, who have already been subdued. Gazprom has been accused of with-
under long-term contending with record high prices in recent holding some supply to convince European
contracts. months. regulators to let its Nord Stream 2 pipeline pro-
According to data on the Gazprom Export ject go ahead, although some analysts point to
website, no supply for next year has been offered Ukraine offering unfavourable terms for Rus-
since August 23, when up to 64,770 MWh was sian gas transit.
put up for sale for delivery to the Dutch TTF hub. The situation has been exacerbated by a fire in
The company has traditionally offered next-year early August at one of Gazprom’s key processing
supplies continuously. The sale of contracts for plants in Western Siberia, which has knocked
2023 has continued. out some of its capacity.
Gazprom set up its ESP in 2018, in order to Gazprom Export’s ending of offers for 2022
secure additional gas sales beyond those vol- gas delivery on its ESP also comes after a Ger-
umes supplied under its long-term contracts. man court last week denied Nord Stream 2 a
The platform has seen a steady increase in usage waiver from EU gas markets, potentially restrict-
since its launch, with sales exceeding 40bn cubic ing Gazprom’s use of the pipeline. ™

PERFORMANCE

Gazprom profits triple in Q2 on

gas price spike

RUSSIA NET income at Russia’s Gazprom tripled year on “Profitability was in fact very good, rising
year to RUB521bn ($7bn) in the second quarter, quarter on quarter despite what should have
Gazprom enjoyed a the company reported on August 30, on the back been a significant drop on seasonality factors,
growth in prices and of a strong recovery in gas prices in Europe. driven by realised European gas prices that rose
volumes. European gas prices slumped in 2020 as circa 16% q/q,” BCS GM said in a research note.
coronavirus (COVID-19) restrictions cut into “We think Q2 2021 is only a stepping stone to
demand while supply remained high. This year a much stronger H2 2021, given the massive,
is a different story, however. Besides the rebound ongoing rally in European gas prices on spot on
in demand, supported by increased economic futures markets.”
activity, a hot summer and greater gas injection Gazprom can look forward to even stronger
into storage, supply has remained constrained. earnings in the third quarter, during which Euro-
Gazprom sold its gas on average for pean wholesale gas prices soared even higher to
RUB15,469 ($211) per 1,000 cubic metres more than $500 per 1,000 cubic metres.
in Europe in the first half of the year, versus The company said it was projecting appor-
RUB9,475 a year earlier. Its sales volumes to the tioning RUB1.8 trillion for investment this
continent increased to 120.6bn cubic metres, year.™
from 98.2 bcm.
The company’s revenues in Q2 reached
RUB2.07 trillion ($28bn), compared with
RUB1.16 trillion a year earlier, which was in line
with the consensus of analysts. EBITDA came
in at $9.5bn, or 5% higher than the forecast of
BCS Global Markets (GM). Gazprom’s net profit
exceeded the brokerage’s expectations by 13%.

P10 www. NEWSBASE .com Week 35 01•September•2021