Gazprom declines to book extra capacity via Ukraine, Poland in 2022
Russia's Gazprom has declined to book extra transit capacity via Poland and Ukraine in January-September 2022, data from several auctions shows, with the supplier hoping to reroute shipments via the Nord Stream 2 instead, according to analysts.
Gazprom can still book transit capacity in future monthly auctions, but its reluctance to book yearly volumes may indicate its expectation that Nord Stream 2 will be up and running by next year. The pipeline is technically complete and its first string is filled with gas, but it is awaiting the certification of its operator.
"Gazprom's refusal to book transit capacity via Poland next year should be no surprise, as even a partially-open Nord Stream 2 should be able to fully absorb the volumes traditionally shipped via Yamal-Europe," analysts at BCS Global Markets (BCS GM) said in a research note on November 2.
Even if the company's usage of Nord Stream 2 is confined to 50% of its capacity, should it fail to secure a waiver from EU energy competition law, it will still be able to replace the 28bn m3/year Yamal-Europe pipeline with cheaper transport via Nord Stream 2, BCS GM said.
"Through 2024, Gazprom is committed to shipping a minimum of 40bn m3 of gas each year via Ukraine, meaning that any meaningful shipments of gas via Nord Stream 2 by necessity must come from volumes that would have otherwise gone via Yamal-Europe," the Moscow-based brokerage explained.
The Yamal-Europe pipeline has been working in reverse for much of the last week, with supplies instead flowing from Germany to Poland. Gazprom's long-term contract for transiting gas via Poland expired last year and the company has switched to booking capacity on a monthly basis, using the route as a balancing system.
"We believe that the drop in pumping through the pipeline might be explained by the actual gas needs of the European gas consumers, which in turn might be driven by the warm weather," VTB Capital (VTBC) commented on November 1.
The December delivery contract at the Dutch TTF hub is trading 8% higher today at €73.1 ($84.7)/MWh.