The European Commission may agree to a “big reverse” of gas from Slovakia to Ukraine in order to put pressure on Gazprom
Moscow - Kyiv, June 26 (Navigator, Mikhail Stamm) - Against the background of the cessation of Russian gas supplies, Kyiv again asks Brussels to put pressure on Slovakia to organize a reverse using transit gas pipelines. Until now, the European Commission has been cool to the idea of a large reverse, but may change its approach in order to push for a settlement of the gas conflict between Russia and Ukraine, according to Kommersant’s sources in the industry.
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Yesterday, European Commissioner for Energy Günther Oettinger held regular negotiations with the head of the Ministry of Energy of Ukraine Yuriy Prodan. The minister tried to convince the European Commission to return to discussing the reverse flow of gas from Slovakia using transit gas pipelines. As Prodan himself clarified, at the end of April the European Commission, Ukrtransgaz and the Slovak gas transport operator Eustream signed a memorandum on organizing the so-called small reverse with a capacity of up to 8 billion cubic meters per year, while the option of a large reverse (up to 30 billion cubic meters) is listed in the document as promising .
The small reverse implies the completion of a separate low-capacity gas pipeline from the Slovak Vojany to the Ukrainian Uzhgorod, which is expected to be completed by October; at the initial stage, the supply volume will not exceed 2,2 billion cubic meters per year. Ukraine insists on a large reverse using one of the four pipes through which Russian gas transits from Ukraine to Slovakia. In April, Günther Oettinger stated that the transit contract between Eustream and Gazprom Export does not allow Slovakia to organize a large reverse without Russia’s permission.
Reversing gas from Slovakia may turn out to be much more profitable for Kyiv than buying gas from Gazprom at its proposed price of $385 per 1 thousand cubic meters. Spot prices in Europe, against the backdrop of a summer drop in consumption, dropped below $260 - thus, even taking into account transportation costs, Ukraine could receive reverse gas for about $300.
The European Commission has legal leverage to change the Slovak Gazprom contract. The country has implemented the Third Energy Package, and Brussels may ask local regulators to reconsider the agreement.
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