Europe reducing LNG imports, Gazprom transit request via Ukraine at 41.9 mcm
MOSCOW. Aug 5 (Interfax) - The operations of European import terminals for regasification of LNG in early August showed a tendency to slow down.
The request for transit of Russian gas through Ukraine was unchanged on Friday.
Ukraine's Gas Transport System Operator (GTSOU) has accepted a request from Gazprom for Friday to transport 41.9 million cubic meters of gas through the country, unchanged from Thursday, data from GTSOU show.
Capacity was requested only through one of two entry points into Ukraine's Gas Transport System, the Sudzha metering station. A request was not accepted through the Sokhranivka metering station.
"Gazprom is supplying Russian gas for transit through the territory of Ukraine at the volume confirmed by the Ukraine side via the Sudzha metering station at 41.9 million cubic meters on August 5, with booking via the Sokhranivka metering station declined," Gazprom spokesman Sergei Kupriyanov told reporters.
GTSOU declared a force majeure in regard to accepting gas for transit through Sokhranivka, claiming that it cannot control the Novopskov compressor station. Ukraine also said that if gas continued to be fed from Russia to the Sokhranivka station, amounts would be reduced accordingly at the exit points from Ukraine's gas transport system. The route through Sokhranivka provided transit of more than 30 mcm of gas per day.
Gazprom believes there are no grounds for force majeure or obstacles to continuing to operations as before.
Data for the first three days of August are demonstrating a downward trend for both LNG regasification and LNG inventories at terminals in Europe. Terminals were operating at 65.8% capacity on Wednesday, compared to July's average of 69%, with peaks as high as 76%. In Gas Infrastructure Europe's statistics, Italy showed an almost two-fold drop in LNG intake. It is worth noting, however, that all three days of August, for which data are available, were weekdays when the gas industry operates at peak capacity. The region remains a premium market for LNG as prices in Asia are inferior to those in Europe, although they are also starting to move there as China's Covid-19 restrictions are eased and autumn approaches.
The Nord Stream pipeline (NS1) from Russia to Europe pumped 33 mcm of gas on August 4.
At full capacity, NS1 can pump up to 167 mcm of gas per day, but capacity has been falling due to disruptions in the maintenance schedule for compressor equipment at the Portovaya compressor station that feeds the pipeline. It has gas pumping turbines from Rolls-Royce, whose gas turbine business was subsequently acquired by Germany's Siemens.
The delays are due to sanctions that Canada imposed against Gazprom, as a result of which one turbine was not returned to Russia on time from Siemens Energy's service center in Montreal. Meanwhile, the time has come for maintenance on other turbines, both due to them reaching the end of their operating period between repairs and due to breakdowns.
Spot prices for gas in Europe with Nord Stream compressors out of action are holding above $2,100 per 1,000 cubic meters. Prices in Asia are rising on the back of prices in Europe. The most expensive January futures on the JKM Platts (Japan Korea Marker) index, which reflects spot market prices for gas delivered to Japan, South Korea, China and Taiwan, are now trading at $1,830 after holding at $1,300-$1,400 for a lengthy period.
Europe is continuing to inject gas into underground gas storage (UGS) facilities, where stocks now stand at 70.89%, up by 0.35 percentage points on the last reporting date, August 3, data from Gas Infrastructure Europe show. This is the minimum level over the pasts fice days - pumping has fallen due to hot weather in Europe.
Data on the state of UGS, reserve levels in which are now regulated by the law, have become one of the most important economic and political indicators for Europe, reflecting EU leaders' ability to ensure energy security.
Europe imposed tight regulation of the use of UGS this year. Reserves are supposed to be at least 80% of UGS capacity by the start of the 2022 offtake season and increase to 90% in subsequent years.
Wind power generation in the region in four days this week accounted for 10% of the EU's energy mix, compared with last week's average of 11%, data from WindEurope show.