Gas imbalance: the rate of gas injection into storage facilities is high, but reserves are very low
14 May 14:07
Natural gas reserves in Ukraine’s underground gas storage facilities have already exceeded 6 billion cubic meters, but this figure is the lowest in at least the last 11 years. Such data is provided by the specialized publication ExPro Daily Gas, "Komersant Ukrainian" reports.
As of May 11, underground gas storage facilities were filled by 19.4%, and compared to last year, 31.7% or 2.79 billion cubic meters less gas is stored in the storages.
At the same time, active gas reserves in underground storage facilities amount to almost 1.28 bcm. This volume can be withdrawn by customers of storage services.
How gas is pumped into storage facilities
Injection volumes slightly decreased to 26 million cubic meters as of May 11. But, as ExPro experts emphasize, these volumes are higher compared to May last year.
In total, since the beginning of the month, more than 350 million cubic meters of natural gas have been pumped into storage facilities, 33% more than in the same period last year.
Since the beginning of this year’s injection season (April 17), 610 million cubic meters of natural gas have already been pumped into Ukrainian storage facilities, including 258 million cubic meters in April.
ExPro estimates that by the end of May, gas reserves in Ukrainian storage facilities could reach almost 6.6 bcm, given stable natural gas imports of about 14 mcm per day in recent days.
Will Ukraine have sufficient gas reserves in November?
If this year’s minimum target is 9 bcm (13.6 bcm including 4.6 bcm of active gas that serves as a buffer), then 7.7 bcm more must be pumped in between now and November 1. These are the benchmarks outlined by the former head of the Gas Transmission System Operator of Ukraine, Serhiy Makohon.
According to him, Ukraine’s own production, according to the existing figures and normal consumption, will allow us to pump about 2.7 billion cubic meters of gas. This means that at least 5 billion cubic meters of additional gas will need to be imported, or approximately 870 million cubic meters per month or 29 million cubic meters per day.
Currently, the daily injection is 28.5 million m3 and at this rate, only 6.15 billion m3 of the minimum required 9 billion m3, or only 68%, will be injected into the UGS facilities by November 1.
How much gas has already been contracted
The expert reminded that the media reported that Naftogaz and Ukrtransgaz had contracted 1.8 billion cubic meters since the beginning of the year. But, according to him, it should be understood that 0.9 billion cubic meters were imported to Ukraine in February-April, so almost all of it has already been consumed and it would be incorrect to take these volumes into account as a reserve for the next winter. That is, a little less than 1 billion cubic meters out of the 5 minimum required, or 20%, have been contracted for the next heating season.
Will there be funds for procurement?
According to Makohon’s estimates, $2-2.5 billion is needed to import the minimum 5 billion m3.
“Donors have already provided $0.4 billion, maybe they will give something additional, but even without them, I think that funds will be found. Including from the budget through direct recapitalization of Naftogaz. There is gas in Europe and the price is adequate,” says Serhiy Makohon, former head of the Ukrainian Gas Transmission System Operator.
Therefore, the expert concludes, “the only question is whether Naftogaz has the money and the time left.”
