Von der Leyen's verbal interventions bring EU gas prices down, Gazprom transit request via Ukraine 42.1 mcm
MOSCOW. Aug 31 (Interfax) - The spot gas price in Europe has fallen after an official announcement by the EU leadership that average stocks in the bloc's storage facilities has reached 80%. Data about gas stocks are public and detailed, and are updated on a daily basis. It was possible to say with certainty when these stocks would reach the target level one or even two weeks ago. However, the confirmation by the bloc's leadership of information that is already well known played the role of verbal intervention in the market.
"We have reached now in the European Union an average storage filling of 80%. So we basically have reached already the amount that we have agreed on for this year," European Commission President Ursula von der Leyen said at the Baltic Sea Summit in Copenhagen on Tuesday.
The request for transit of Russian gas through Ukraine on Wednesday was little changed from previous days and months.
Ukrainian transit
Gas Transport System Operator of Ukraine or GTSOU has accepted a request from Gazprom for Wednesday to transport 42.2 million cubic meters of gas through the country, as on Tuesday, 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 42.1 mcm on August 31, 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.
European market
The Nord Stream pipeline has been stopped for a brief, three-day period of maintenance, until the early hours of September 3. Pumping via the Nord Stream pipeline from Russia to Europe has fallen to 33 mcm per day. At full capacity, the pipeline 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 have corrected down to $2,583 per thousand cubic meters. Prices in Asia have followed them down. The most expensive, January, futures contract on the JKM Platts index, which reflects spot market prices for gas delivered to Japan, South Korea, China and Taiwan, is $2,270.
Some capacity of the Norwegian Troll field and the Kollsnes gas treatment unit was shut down for annual maintenance from August 13 until the end of the month. Production capacity will decrease by 20 mcm of gas. Major new shutdowns at Norwegian fields lie ahead.
Wind plants generated 8.7% of the EU's electricity on Tuesday and 9.5% in the past week, down from 11.4% in August last year, data from WindEurope show.
LNG regasification terminals in Europe have been operating at 58% capacity in August, compared to July's average of 69%, according to Gas Infrastructure Europe data. Average daily supply from LNG terminals in August is down 14% month-on-month. Imports of costly LNG are decreasing, partly as gas storage builds to the necessary levels.
Gas stocks
Europe continues to inject gas into underground gas storage facilities. Data about the state of UGS, 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.
The lower threshold was reached on August 29, the last reporting date, when UGS gas stocks stood at 80.17%. Reserves in storage have now surpassed the target level in Belgium, the Czech Republic, Denmark, France, Germany, Italy, Poland, Portugal and Spain.
Meanwhile, Austria, Bulgaria, Croatia, Hungary, the Netherlands and Latvia are lagging, with the latter in the rear with 55% as it stopped injecting gas into its Incukalns storage facility in mid-August