Update: Gazprom Supplies Private Turkish Firms Again
(Updates April 15 report with more comment)
Russian gas export monopoly Gazprom is resuming full flows to private companies in Turkey, sources told NGE April 14. "I am aware that the volumes have been increased," said an Istanbul trader with a foreign investor.
The reduction in flows had not however been a problem for an over-supplied market, he said, with power generators able to cope with the relatively mild winter although, as he was not working for one of the companies affected, the reduction "was not a big story from our point of view."
Gas trade relations between Gazprom and private importers are one of the more important topics regarding the Turkish gas market, a source at a Turkish think-tank told NGE. But he said he could not confirm that the discount rate had been completely terminated.
Another trader, also not with one of the affected companies, told NGE April 19 that the flows restarted April 1 in full, but that while Gazprom had reinstated the 10.25% discount for Q1, from now on it would supply the traders without any discount, putting their price at parity with Gazprom's price through the Balkans. He said the price for Q1 would be the oil-indexed price it charged Botas, less 10.25%.
He thought that this would improve Gazprom's chances in the ongoing arbitration case with Botas, since if it charged Botas more, that would be shown to be discriminatory. "They must charge the same price for the same molecules through the same route," the trader said, estimating it at $175/'000 m³. He conceded that elsewhere in Europe Gazprom did not follow that policy.
Gazprom also supplies gas to Botas through Blue Stream, which goes under the Black Sea.
The private companies won rights to the gas following an auction held by the dominant importer, Botas, with delivery only offered at the western end, through pipelines that come through Ukraine and the Balkans.
Indicative of the unusual relationships that can exist in the gas industry, the owners of these companies include Anglo-Dutch major Shell, which is partnering Gazprom in a slew of upstream and midstream projects in Russia including Nord Stream 2 and Sakhalin Energy; and Gazprom itself.