Gazprom pipelines and export capacity

Газопроводы Газпрома и экспортные мощности

Gas pipelines of West Siberia

Газопроводы Западной Сибири

Export flows of Gazprom

Экспортные потоки

Spot, Gazprom, Brent

Цены на нефть и газ

End-use price of gas

Russia and USA

Daily gas production

Суточная добыча


Pipeline and storage capacity inside Russia is not enough to provide secure gas supplies to Europe


Gazprom was unable to provide contracted gas flows to Europe during a period of extremely low temperatures in the South European Russia. In the period from February 1 to 6, 2012, the flow via the Yamal-Europe pipeline to the Mallnow terminal at the Polish-German border was 31% lower than in the same period of 2011. The drop of the flow from Ukraine to Slovakia (Velke Kapusany) is reported at 43%, though it was much warmer in Europe in the early February 2011 than now.

In my view, the failure was caused by the combination of the three following factors.

1) The cold period in Central and South European Russia coincided with the presidential election campaign. Gazprom could not reduce supplies to Russian consumers as it usually does.

2) Gazprom has made a strategic mistake by abandoning its gas storage expansion program for 2005-2010. By January 2012, the maximum daily storage withdrawal rate was about 150 mmcm lower than planned. Moreover, the drop of demand in 2009-2010 gave a very good opportunity for injecting large volumes of cushion gas into the new storage facilities, but Gazprom did nothing.

Figure 1. Planned and Actual Maximum Daily Storage Withdrawal Rate, mmcm

(1) Estimations based on Gazprom report; (2) Gazprom reports.

3) Gazprom has sharply reduced the procurement of Turkmen gas. Russian regions bordering Kazakhstan need to replace about 100 mmcm/day of Turkmen gas by gas from West Siberia.

There is not enough gas to fill up export pipelines, though the latter have a substantial spare capacity. The commissioning of the Bovanenkovo-Ukhta pipeline later this year will not improve the security of European exports. The bottleneck will be solved when the Ukhta-Gryazovets pipeline is commissioned.

Mikhail Korchemkin

East European Gas Analysis

Malvern, PA, USA

 

February 14, 2012

 

 


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