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customers via Ukraine, will cease on January 1, 2020.
He went on to say that even if Gazprom build up its reserves in European storage tanks, which it has been doing in recent months, there will still be a deficit of some 5-6bn cubic meters (bcm) of gas in the European market.
Gazprom supplied 200bcm of gas to Europe last year and this year is forecasting deliveries to fall by 5% to 191bcm, or almost 37% of Europe’s gas.
Both companies are anticipating a clash and both companies are now actively storing as much gas as they can during the summer ahead of the start of the heating season.
Gazprom expects two pipelines that bypass Ukraine — Nord Stream 2 under the Baltic Sea and Turkish Stream across the Black Sea — to start on schedule by the end of the year. Doubts over whether Nord Stream 2 will be ready on time have grown Denmark has refused to grant Gazprom construction permissions, but the Russian company is trying to find a way around Danish territorial waters, saying it is confident it can complete the pipeline even without Denmark’s permission, but that could push the completion of the pipeline into the first quarter of next year.
Gazprom Deputy Chief Executive Officer Elena Burmistrova told Bloomberg: that with the “two streams and a possibility of finding an agreement with Ukraine on extending the existing transit contract” Gazprom is sure it can remain a reliable gas supplier to Europe, Burmistrova told reporters at a briefing. “We wouldn’t want to believe in an apocalyptic scenario.”
Europe is better prepared for any cutoffs of Russian gas transit via Ukraine. Prices are near a three-year low as liquefied natural gas (LNG) deliveries have soared, and inventories look healthy after a mild winter, reports Bloomberg.
Gazprom is willing to offset the Ukraine transit risks by adopting a flexible approach to talks with Naftogaz, Burmistrova said.
“Either a mid-term or short-term contract will suit us, we are ready to discuss any options once we understand who we should discuss them with,” she said.
Naftogaz has a plan B, Vitrenko said on Tuesday in a Facebook post. The Ukrainian company is ready to sign a deal on gas swaps with Gazprom beyond 2019, according to Vitrenko. Under the swap deal, Gazprom could transfer gas to Naftogaz at the Russian-Ukrainian border and Naftogaz would then send the same volumes to its borders with EU countries, Vitrenko said.
Gazprom is boosting injections into European underground gas storage sites and plans to have at least 5% of volumes under the European supply contracts in regional storage facilities to ensure it meets client demand in winter, Burmistrova said. Gazprom sees no need to revise down its target for deliveries in Europe and Turkey, estimating shipments of 194bn to 204bn cubic meters this year.
“Our supplies of around 200bn cubic meters per year is a new reality for the European gas market, and it’s all that matters,” Burmistrova said.
2.1 Farmland market, improved investment climate among Zelenskiy’s top policy priorities
Ukrainian President Volodymyr Zelenskiy listed his top priorities at a June 20 business forum in Kyiv,” Dialogue between State Authorities and
14 UKRAINE Country Report July 2019 www.intellinews.com