Slovakia braces for potential gas crisis

WHILE Russian natural gas continues to flow via Ukraine to Slovakia, the country is prepared for a potential gas crisis. Underground gas storage facilities are full enough to cover almost five months of natural gas consumption, while natural gas can also be transported to Slovakia via two reverse flows from the West, authorities say.

WHILE Russian natural gas continues to flow via Ukraine to Slovakia, the country is prepared for a potential gas crisis. Underground gas storage facilities are full enough to cover almost five months of natural gas consumption, while natural gas can also be transported to Slovakia via two reverse flows from the West, authorities say.

Representatives of the national gas utility Slovenský Plynárenský Priemysel (SPP) and the Slovak gas transmission operator Eustream met with Prime Minister Robert Fico and Economy Minister Pavol Pavlis on August 14 to report to the officials that they are prepared to secure reliable gas supplies in the event of a reduction or halt of gas delivered through Ukraine.

Fico had requested the meeting in response to the worsening geopolitical situation with respect to Ukraine and Ukrainian sanctions against Russia, which may also affect gas supplies from Russia. Slovakia imports almost 100 percent of its annual natural gas consumption - about five billion cubic metres - from Russia.

“In case the gas flow via Ukraine is halted … then Slovakia is prepared,” said Tomáš Mareček, CEO of Eustream, as cited by the TASR newswire. “The first thing is that Gazprom still has a contractual duty to supply gas to the Slovak company SPP. Thus, [in the event of interrupted supplies via Ukraine] it would have to find another way to supply SPP, for example, via Nord Stream and the Czech Republic.”

Eustream reported on its website on August 14 that the gas flow from Ukraine is currently continuing normally, suggesting that “Eustream did not record pressure reduction or a decrease in gas volume at the Veľké Kapušany Compressor Station on the border with Ukraine”.

But according to Fico, Slovakia should prepare itself for more complicated scenarios in order to avoid a repeat of the situation in January 2009, when gas supplies from Russia to Slovakia were halted completely for about two weeks. This led to a reduction in gas supplies to industrial consumers, bringing them extensive costs.

“Neither people nor Slovak industry, however, need to worry, even in the event of a drastic cut in gas supplies,” said Fico, as cited by the SITA newswire.

Moreover, Slovakia has certain duties as a gas transit country.

“I can state with a certain extent of satisfaction that gas supplies via Slovakia precisely follow the plan; we have no interruptions,” said Fico, as cited by TASR. “We would prefer if such a state were permanent, but when we look at the situation in Ukraine, we have to prepare for more complicated … scenarios.”

Fico urged the European Commission to be more active regarding Ukraine’s proposal to adopt sanctions against Russia. Nevertheless, on August 14, Ukraine enacted such sanctions.

“It is strange if a country that has signed an EU Association Agreement, a country which we all strive to help … instead of coordinating its positions with the European Union, takes unilateral actions which, even though only formal at this moment, still threaten the individual economic interests of the member states,” said Fico, as cited by SITA. “The European Commission should be more active in this case. It is necessary to work with Ukraine more actively so that such things like a law for sanctions do not occur. We do not want to be held hostage to the Russian-Ukrainian dispute.”

SPP is watching the development of the situation closely and is preparing alternatives for scenarios considered by the European Commission. Yet, regardless of the scenario, it is important that if a reduction in the gas supplies occurs, SPP makes use of several tools in order to secure gas to all of its clients uninterrupted, Ondrej Šebesta, a spokesperson of SPP, wrote in the press release.

Šebesta specified that SPP is currently storing 1.36 billion cubic metres of gas in underground gas storage facilities in Slovakia, and this volume should increase to 1.43 billion cubic metres by September 1.

“The volume of stored gas in the storage facilities will be big enough to cover consumption of all SPP clients for about five months,” said Šebesta.

Slovak legislation requires gas suppliers to keep a one-month consumption reserve for their clients.

SPP is also prepared to buy natural gas at spot markets and transport it via reverse flows from the Czech Republic and Austria.

“The reverse flow is technically prepared for its possible launch within several hours,” said Šebesta. “In such a case, SPP will also be able to cover the needs of its clients, in the event of a halt in supplies, for six months, which is the worst scenario anticipated by the European Commission.”

SPP is also prepared to negotiate with foreign companies that store gas in underground storage facilities in Slovakia, with the aim of using it for the needs of Slovak consumers.

The storage capacity of underground natural gas facilities operated by Nafta, the biggest gas storage company in Slovakia, currently stands at 2.4 billion cubic metres. During the summer, gas is being pumped into the underground facilities and is extracted in winter when demand goes up.

Štefan Šabík, CEO of SPP, explained for TASR that filling underground storage facilities is a long-term, ongoing process, which cannot be carried out in one or two months. SPP has rented 1.6 billion cubic metres.

“Filling is a process which has been going on probably since March, April of this year,” said Šabík.

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