European Gas Firms Want Continuation of Russian Gas Supplies
- Business Companies Eurozone Oil & Gas
Global Business Magazine- 5 minutes read
With less than a fortnight to go for Ukraine to discontinue Russian gas supplies to European Union, gas firms in Austria, Slovakia, Hungary and Italy has urged the European Union (EU) Chief Ursula von der Leyen to avoid interruption of gas supplies.
It may be recalled Ukraine has decided not to renew a major agreement allowing Russian gas to transit through its borders to some European nations including the above said four countries from 1 January 2025.
In a joint declaration addressed to the EU Chief, the gas companies in the Central Europe including Moldovagaz, SPP, Eustream, MVM and MOL, said that end of the deal could complicate the supply of gas and result in higher gas prices for European consumers.
They said that as natural gas suppliers, industrial customers, transmission system operators operating in the four countries were aware of the crucial importance of natural gas as an essential transitional energy source for these nations and their economies.
They also acknowledged the historical importance of the existing gas transmission infrastructure, in particular the gas pipelines passing through Ukraine, to ensure reliable, cost-effective and safe transportation of natural gas from the Ukrainian side to these countries at present and after January 2025.
“Reaffirming our commitment to the principles of energy security, diversification and cooperation in the European Energy Space, and aware of the geopolitical complexities and sensitivities of energy supply routes, in particular in view of recent global developments and regional tensions, we express our common interest in maintaining uninterrupted natural gas transportation from the Ukrainian side to the relevant countries and further,” the gas companies said.
They also reiterated their unwavering support for the continued operation and maintenance of the existing gas transmission infrastructure after 1 January 2025, including pipelines and related facilities that enable the transmission of natural gas from the Ukrainian side to the Target Region and beyond.
“Our recognition of the importance of diversifying sources and routes of gas supplies, including the development of alternative energy sources and infrastructure, as part of a comprehensive strategy to enhance energy security and resilience across Europe,” the gas companies said.
Impact on Gas Prices
According to the letter, the gas firms said that continued gas supplies from the Ukrainian side will contribute to maintaining low gas prices and help support the competitiveness of industries in the four countries.
Any disruption in the transportation of natural gas from Ukrainian side to the Hungary, Slovakia, Italy and Austria could complicate gas supplies to these countries and lead to increased gas transportation costs, which could in turn lead to higher gas prices for European consumers.
“In this regard, energy-intensive industry is particularly affected due to its high dependence on security of gas supplies and competitive energy prices. Such disruption of supplies could also lead to increased risks for the Ukrainian energy system, jeopardise the course of the current heating season, and consequently exacerbate humanitarian problems by increasing the number of refugees from Ukraine to the EU due to complicated and adverse living conditions,” the letter said.
“Our interest in striving for reliable, safe and sustainable natural gas transportation from the Ukrainian side to Europe and contributing to the development of a more integrated, resilient and sustainable energy market for the benefit of current and future generations. If a solution can be found to continue natural gas transportation from the Ukrainian side, we are ready to implement such a solution in practice,” the gas companies said.
