Plus almost 1.7 billion: this is how much gas reserves in Ukrainian storage facilities increased in July
5 August 14:57
The equator has been passed. Three months of active filling of Ukrainian storage facilities with natural gas are behind us, and three more are ahead. "Komersant Ukrainian" found out how optimistic the dynamics of this process are.
All this is very much like a race. Where time is limited, as well as technical and financial opportunities. And where there is a goal that must be achieved by all means. It has been officially confirmed these days. The new Minister of Energy of Ukraine Svitlana Hrynchuk made this statement at a meeting of the Parliamentary Committee on Energy, Housing and Utilities.
“We are now focusing on natural gas imports. We are now practically provided with the financial resources to continue purchases until the beginning of winter, and we have accumulated at least 13.2 billion cubic meters of gas by the beginning of the heating season. At the moment, we are moving according to the plan and even ahead of schedule in terms of both injection and production,”
– the official emphasized.
The dynamics are positive
The filling of underground storage facilities with natural gas is currently taking place neither according to the pessimistic nor the optimistic scenario, but according to the medium-sufficient scenario. It is assumed that the 13.2 billion cubic meters of gas pumped into the storage facilities will meet the country’s basic needs, although it will not protect us from problems in the event of any crises.
What quantitative indicators characterize the current stage of filling underground gas storage facilities? Mykhailo Svyshcho, an analyst at ExPro agency, tells about this in more detail.
“As of August 1, we have 9.83 billion cubic meters of gas in storage. In July, almost 1.7 billion were pumped in. This is the highest value in two years, since July 2023. In terms of injection, the volume increased by 1.9 times compared to July last year. On average, almost 55 million cubic meters per day were injected in July. This is 21% more than in June. In July, imports averaged 27 million cubic meters per day. Most of the 1.7 billion cubic meters pumped is domestic gas production, which is about 870 million, and imports are 830 million. Domestic production continues to recover gradually,”
– the expert said.
At the equator of the course, it is logical not only to summarize the intermediate result, but also to assess the prospects for achieving the stated goal, Svyshcho said. 13.2 billion is a figure that was announced by the new Minister of Energy as a minimum target. Taking into account the expected production and consumption, the expert says, 1.7 billion cubic meters of imports remain to be pumped in three months. The need for imports is about 560-570 million cubic meters per month, which is, in principle, a completely achievable goal.
“In July, we imported 830 million cubic meters, and most likely, in August it will be slightly less. But in these first days of August, we see that imports remain at about 20 million cubic meters, which means that imports are expected to remain at this level for a month, and it will be more than 600 million cubic meters for the month. That is, we are fully reaching the volumes we need,”
– the expert believes.
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Finances also matter
Do you have the funds to buy all these volumes of gas? At the end of July, Naftogaz announced that it had attracted two loans of UAH 4.7 billion each from PrivatBank and Ukrgasbank. These funds are to be used to build up natural gas reserves. The logical question is, how long will they last? Mykhailo Svyshcho believes that they are not enough for imports. They will be enough for a little less than 600 million cubic meters, and we need to import about 1.7 billion cubic meters. That is, these funds cover only a third of imports.
“Therefore, we need to raise additional funds. As far as we know, Naftogaz reported that it is now at the final stage of concluding agreements with European partners on the provision of new loans or grants. I think that theoretically, we can expect additional announcements about reaching agreements with European partners on providing new funds for gas imports in the near future,”
– said the expert.
In fact, the Chairman of the Board of Naftogaz of Ukraine Sergiy Koretsky confirmed at the end of July that, along with the conclusion of loan agreements with Ukrainian banks, the company continues to cooperate with international financial organizations and partner countries.
Sources and routes of supply are being diversified
Another July news item from Naftogaz is the conclusion of the first agreement on the purchase of Azerbaijani gas with SOCAR Group company SOCAR Energy Ukraine. It was also reported that for the first time, a test delivery of gas was made via the Trans-Balkan corridor on the route Bulgaria-Romania-Ukrainian border. According to Svyshcho, the fact that for the first time in history we imported Azerbaijani gas and it actually, physically entered Ukraine is important in the context of future agreements that may be made on the import of Azerbaijani natural gas to Ukraine.
“This may be for Ukraine’s own needs or, as discussed earlier, it may relate to the idea of importing Azerbaijani natural gas through the Trans-Balkan route to Ukrainian gas storage facilities with possible resale to Europe in winter. Theoretically, this could work, but given that Ukraine has a rather large demand for natural gas, I don’t think this mechanism will be actively used now. But, nevertheless, a test supply is good for testing the mechanism,”
– explained Mykhailo Svyshcho.
In general, in July, the Trans-Balkan route began to be used more actively for gas supplies. According to the expert, about 5 million cubic meters were supplied from Greece to Ukraine in a month, or about 160 thousand per day. And since the beginning of August, the volume of supplies via this route has increased to 400 thousand cubic meters per day. But the main burden, as Mykhailo Svyshcho emphasized, falls on the three traditional routes of gas supplies to Ukraine. In July, 300 million cubic meters were imported from Hungary, 268 million cubic meters from Slovakia, and 260 million cubic meters from Poland.
To summarize the situation at the midway point, it is clear that the storage facilities are being dynamically filled with gas, funds are available for the purchase of the resource, existing sources and routes are being used, and new ones are being developed. That is, there is reason to hope that the stated goal will be achieved. Although surprises are possible over long and difficult distances.
Sergiy Vasylevych
