Ukraine Starts Importing Natural Gas from Slovakia in September

Kyiv, August 15, 2014. The Slovakian gas transportation system operator Eustream completed preparations for the reverse supply of natural gas to Ukraine. Such statement was released by the Eustream representative Vagram Chuguryan. On March 1, 2015 the pipeline will be able to operate at maximum capacity of 10 billion cubic meters of natural gas per year, emphasized the company official.

“We are ready to start the reverse gas supply from Central Europe to Ukraine in control mode on September 1, which provides for the transfer of about three billion cubic meters per year”, said Chuguryan, as reported by Ukrainska Pravda.

The Eustream representative noted that during the Open Season procedure several European companies have provided binding applications to transport gas through the pipe. In the last three months the experts of Slovak gas transportation system operator reviewed technical capabilities of the Uzhgorod-Vojany gas pipeline, which was built 15 years ago. They also checked the construction of an additional 400-meter pipeline to the Ukrainian border. Notably, the Ukrainian state company “Naftogaz” purchased most of the transit capacity of the new pipeline to 2019.

Suffice it to say that on June 16, 2014, Ukraine has been cut off from Russian natural gas supply. The volume of natural gas available in August – March will amount to 23 billion cubic meters, according to the state officials. Thus, to cover the deficit Ukraine will have to import 7.23 billion cubic meters of natural gas. Earlier it was reported that Ukraine’s gas import potential from the EU countries during the same period can reach up to 10.5 billion cubic meters. This way Ukrainian state is confident that frugal use of available natural gas and reverse gas supply from Europe will allow it to fully meet the needs for domestic consumption without having to import any Russian gas.

Remarkably, Ukraine has been pursuing energy independence from Russia for nearly ten years now. Thus, since 2005 and until 2013 the Eastern European state cut annual gas consumption by 26.042 billion cubic meters: 76.4 billion in 2005 as opposed to 50.358 billion cubic meters in 2013.

Interestingly, on August 14, 2014, the Verkhovna Rada of Ukraine adopted in the second reading the Law “On amending some laws of Ukraine on reforming the unified gas transportation system of Ukraine” (№4116a). The law provides for the division of “Naftogaz” into two companies in accordance with requirements of the EU third energy package as well as offers foreign investors (assuming that these would be European and American companies) access to operate domestic GTS. The state remains the majority shareholder and requires potential investors to reveal their owners and beneficiaries.