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Monday, February 19, 2018

Ukraine wants to convey Russian gas from Europe to Europe

Ukraine has decided to exclude Russia from gas supplies to Bulgaria and Turkey through its territory. Russia, on the idea of Kiev, is Slovakia. “This is a regular circus. Slovakia we did is a gas-producing country?” – the irony of it experts. As in the case of reverse, the origin of the gas will be Russian. However, in the future, the fantasies of Kiev might be a place even the American LNG.

Ukraine announced plans to become a transit country not only Russian but also European gas to Turkey and Bulgaria. Both countries are willing to buy gas through Ukraine to Europe, said the head of “Ukrtransgaz” Igor Prokopiv.

“It will be very expensive, difficult logistics. But here it is, the idea is not that it was logical and cheap, the main thing that sounded nice”

“Bulgarians and Turks is ready to buy gas in Europe through the territory of Ukraine, there are serious negotiations. In early April we will hold the negotiations with the Slovaks, that earned the route Slovakia – Ukraine – Moldavia – Romania – Bulgaria to Turkey with the possibility to store gas in Ukraine, which will be purchased in Europe”,” said Prokopiv.

As for the current transit of Russian gas through Ukraine, Ukrtransgaz expect to maintain the volumes at the level of 2015. “So far we see that we are at the level of 2015, i.e., those 67 billion and $ 2 billion we need to get (from Gazprom – approx. OPINION)”, – he said. However, he added that “contact with the Russians not as such, in addition to production-level managers”.

This is another game of Ukraine against Russia, which is absolutely meaningless from an economic and political point of view. But the main question that arises in this story: whose gas Ukraine plans to supply from Slovakia to Bulgaria and Turkey?

“This is a regular circus. Slovakia we did is a gas-producing country?” – ironically, the CEO of the national energy security Fund Konstantin Simonov.

In fact, Ukraine offers Bulgaria and Turkey to buy gas directly from Russia transit through its territory and through the mediation of Europe. Exactly now does Ukraine itself: instead of importing directly more favorable Russian gas, she buys the same Russian gas from European traders.

“The situation with the reverse, when Ukraine said that refused from the Russian gas in favor of the European. The gas, which comes back to Ukraine via Slovakia, Ukraine’s called a non-Russian, but actually by birth he is, of course, Russian,” – says Simonov.

In fact, the head of “Ukrtransgaz” himself has confirmed it, stating: “We understand that in the event of complete cessation of gas supply by the Russians in the EU, as we experienced in 2009, we are not able to get reverse in full”. He added that reverse “will not be completely stopped, but 30-40% we can lose.”

This, of course, very optimistic. Actually, if you block the access of Russian gas to Europe through Ukraine, the Europeans just will not be superfluous gas for a neighbor. Suffice it to say that Europe has long energodefitsita. All your power it will throw first for the salvation of your consumers (at the expense of fuel in storage), but not the inhabitants of the country, which is not even a member of the EU.

As for Turkey, bearing in mind difficult relations with Russia, it is not surprising that she agrees to these games. “There was recently a meeting of Erdogan with Poroshenko, the Ukrainian President the idea, most likely, and sold. He also offered the services of Turk Ukrainian storage facilities,” reminds the head of the NESF. The meeting took place a week ago, on March 10.

“This is another story on the topic that Ukraine will replace Russia in the gas issue for someone else. Just if it was a story about the domestic market of Ukraine, now – about transit”, – says Simonov.

As Ukraine makes Russian gas evropeiskikh predicts that further events will develop thus. “Next it will be said that the source of this gas will be American LNG from the Baltic. And although there is no volume or clarity for the price, I am sure, as an element of PR on all this will be complemented by a story that now Europe will begin to use the newly built Baltic LNG terminal (Latvia and Poland), will mix them with Slovakia, and Ukraine will drive gas to Bulgaria and Turkey”, – says Konstantin Simonov.

New LNG terminals in Latvia and Poland is underutilized. With CNG they are getting from Qatar and Norway, now at least one and a half times more expensive than Russian pipeline gas. The price of American LNG, the volume of which is limited, will become, and considering a longer haul distance is more expensive.

So all this can be considered a Ukrainian speculation about the uselessness of Russian gas. Gas expert just wondering how, why invent such a complex and plausible story. “They could keep trolling Russia, stating, for example, the emergence of Iranian gas in the South of Europe. It’s much more logical. From Iran gas goes to Turkey, and now near the South of Europe”, – said Simonov.

The idea of the first supplies of American LNG to Baltic sea terminals, then to Slovakia, Ukraine, Moldova, Romania, to supply power to Bulgaria and Turkey – is the height of absurdity. “It will be very expensive, difficult logistics, a lot of transit risks. It is absolutely pointless. But here it is, the idea is not that it was logical and cheap, the main thing that sounded beautiful,” – says Simonov.

“Ukraine was so captivated by the struggle with Russia that proposes to replace Russia in the transit business, so the gas is in Turkey not Russia, but someone else supplied. Who’s the other one? Ukraine raises the subject to remove Russia from the market of southern Europe, somehow thinking that she will remain in this business. Kiev is playing simultaneously two games, not realizing that they are completely different. Ukraine at war with Russia, not realizing that is part of the Russian gas business as a transit country”, – said the head of the NESF.

And in light of the ongoing reform of the Ukrainian GTS, which Kiev impose European and American masters, all this advertising transit greatness of Ukraine in General looks weird.

The EC demanded that Kiev until the summer to reform the CTA and to save “Naftogaz” from the function of transit. The Ukrainian authorities promised to do everything to the end of the year. That is, this year, the Ukrainian state will not have any relation to the transit of gas. All of this will be transferred into private foreign hands. Most likely, control over the Ukrainian GTS will acquire the Europeans.

For the Ukrainian budget it would mean a loss of income that today “Naftogaz” gets in the form of payment for transit fees. By the end of 2015, Gazprom paid for the transit of 2 billion dollars.

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