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    Ukraine's GTSOU Transits 45% Less Gas in H1


Gazprom only used 77% of the transit capacity allocated this year under its ship-or-pay contract with Ukraine.

by: Joseph Murphy

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Ukraine's GTSOU Transits 45% Less Gas in H1

Ukrainian gas grid operator GTSOU transited 24.9bn m3/yr of gas during the first half of the year, down 45% year on year, it said on July 24.

Ukraine agreed a new gas transit contract with Russia in December, requiring the latter to pay to send 65bn m3 of gas through the country in 2020, versus 89.6bn m3 of actual volumes last year. The minimum ship-or-pay level will fall to 40bn m3/yr from 2021 until the contract's expiry at the end of 2024.

Gazprom has suffered weaker sales in Europe this year as a result of restrictions put in place to slow the spread of the Covid-19, pandemic, as well as warmer weather, high levels of gas in storage and increased LNG imports. It used only 77% of the Ukrainian transit capacity it paid for in the first half of this year.

Ukraine imported 7bn m3 of EU gas in the first half, up 24% yr/yr, GTSOU said. This amount included 1.7bn m3 of virtual reverse or backhauled volumes – gas that is sold to Ukraine by EU firms that is subtracted from Russian transit volumes rather than passing through the country and being physically imported back.

Some 3.7bn m3 of the gas imports were transferred into Ukraine's underground gas storage facilities under the customs warehouse scheme, which allows foreign companies to store gas for up to 1,095 days without paying taxes and customs duties. Overall, some 6bn m3 of gas were injected into storage, up 22% yr/yr.

GTSOU also handled 9.8bn m3 of gas produced in Ukraine, down 7% yr/yr, and delivered 15.4bn m3 of gas to Ukrainian consumers, up 5%.