11 Aug 2022 19:11

Moldovagaz can't pay Gazprom advance for Aug due to $15 mln cash gap

CHISINAU. Aug 11 (Interfax) - Moldovagaz is unable to pay Gazprom due to incomplete coverage of the costs of purchasing and transporting natural gas because of the rates, which has led to a cash flow gap of 285.4 million lei in August, that is, around $15 million, Moldovagaz CEO Vadim Ceban said.

"Due to incomplete rate coverage of all expenses connected to the purchase, supply, transport, and distribution of natural gas, JSC Moldovagaz's cash flow gap will total 285.4 million lei in August. The rate changes in August are not improving the situation with fulfillment of payment obligations, taking into account the fact that the first proceeds at the new adjusted prices for natural gas will come in only in September, 2022," Ceban said on Telegram on Thursday.

According to Ceban, 27.74 million cubic meters of gas were acquired in July at a price of $1,006.11 per thousand cubic meters to total $27.91 million, and 27 million cubic meters have been acquired in August for $39.39 million at $1,458.92 per thousand cubic meters. "The average annual purchase price for gas factored into the current rate from June 1, 2022 is $696.02. Thus, compensation of expenses related to acquiring imported gas will amount to only 382.2 million lei [$21 million]," he said.

Ceban said the day before that the company only has enough funds to cover consumption in July. "We'll close July, but we won't be able to pay the advance for August. That's for certain. We've requested payment deferral from the supplier, but haven't received an answer," he said.

The National Agency for Energy Regulation (ANRE) raised the consumer rate for gas to 23 lei per cubic meter including VAT from 18.62 lei at the beginning of August. According to the methodology approved by legislation, ANRE factored in an average purchase price of $899 per thousand cubic meters in 2022.

Moldovagaz and Gazprom signed a five-year contract for the supply of gas in the fall of 2021. According to the agreement, Moldovagaz is required to pay for gas for the previous month and make an advance payment for gas for the current month by the 20th of every month. According to the formula agreed upon in the contract, the price for gas from Gazprom was $450 per thousand cubic meters in November 2021, $550 in December, $647 in January, $564 in February, $547 in March, $1,193 in April, $920 in May, $880 in June, and $980 in July and is $1,458.5 per thousand cubic meters in August.

The official exchange rate for August 11 is 19.29 lei/$1.