Gazprom Completes Fast-Cycle German Storage Plant
Russian gas monopoly Gazprom has completed the last phase of its salt cavern storage facility at Jemgum, northern Germany, it said August 19. Consisting of 10 caverns, their combined working gas volume is about 900mn m³, making it one of Germany's larges such facilities.
Most of Europe's gas storage capacity is in depleted gas fields, but purpose-built salt caverns allow very rapid injection and withdrawal, so that traders can take advantage not just of summer-winter price spreads, but weekend-working day price spreads as well.
The construction of the facility began in 2008. Five years later, its first phase was put into operation. It is owned and operated by a joint venture between Gazprom's German subsidiary Astora, part of Wingas; and Germany's VNG.
The facility is a few kilometres from the Dutch border and offers direct access to both markets. Russian gas comes in from NordStream and then the North European Line, as well as from the Gascade-operated pipeline grid in Germany.
"As natural gas production in the Netherlands is sharply declining, storage facilities with a connection to the Dutch grid will be in demand to ensure security of supply," said Astora. "Long-term storage contracts at the Jemgum storage facility have made it possible to maintain a comparatively good level of earnings over the last few years," it says. It has used this time to develop new flexible short-term products.
About five sixths of the total storage capacity is marketed by Gazprom and the rest by VNG. "Seeking to enhance the reliability of gas supplies under its export contracts, Gazprom Group is systematically implementing its underground gas storage system development strategy within and beyond the former Soviet Union. This ensures uninterrupted gas supply to foreign consumers in peak demand periods or during gas transmission system maintenance, and increases gas sales," it said.