Russia begins dismantling gas corridor through Ukraine
Finanz.ru, Jun 16 2016
In connection with the construction of the Nord Stream 2, “Gazprom” plans to begin dismantling the pipeline system, built for gas transit to Europe via Ukraine, said at the St Petersburg international economic forum the head of gas monopoly Alexey Miller. He said (quoted by “Interfax”):
The Central corridor of the released capacity that are redundant. “Gazprom” carries ongoing operating costs of maintaining them. In this regard, “Gazprom” initiated the optimization of gas transportation facilities of the central corridor. It is assumed the elimination of 4,300 km (pipes) and closure of the 62 compressor stations with capacity over 3 MW.
However, the Ukrainian route won’t be closed, but deliveries will fall by 5-7 times and will not exceed 10 bcm to 15 bcm. In 2015, Ukraine increased the transit of Russian gas to Europe by 7.9% to 67.1 bcm. According to Miller, the refusal of the Ukrainian GTS will determine economic reasons: as a result of recent decisions of “Naftogaz” for the transit through the Ukraine was 20% more expensive than supplies via Nord Stream 2. Miller said (quoted by TASS):
Transport tariff on Nord Stream 2 is $2.1/k cu m, on 100 km transport tariff through Ukraine $2.5.
Gazprom, as a shareholder of the project will pay transit tariff to itself, the result of saving $1.6b. In addition, the resource base of Gazprom is gradually shifting to the north of the Надым-Пур-Тазовского region of Ямал. Miller said:
The length of the route from Yamal via Nord Stream to 1,885 km less than the gas transportation system of Ukraine. Including on the territory of Russia at a distance of less than 1010 km route through Ukraine for almost one and a half times longer than through the Nord Stream.
The project “Nord Stream 2 involves the construction of two pipelines with a total capacity of 55 bcm/yr from the coast of the Russian Federation through the Baltic sea to Germany. Gazprom will own 50%, BASF, EON, Engie, OMV, Shell, 10% in the project. The new pipeline is planned to build a Nord Stream 1. Poland, Czech Republic, Estonia, Hungary, Latvia, Slovakia, Romania and Lithuania have consistently opposed the implementation of the project citing geopolitical risks. Germany supports the Nord Stream 2 only if “Gazprom” will keep the transit to Europe through Ukraine, said on Jun 8, the Minister of economy and energy of Germany Sigmar Gabriel.