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    Ukraine Demand Grows but Storage Saves Imports

Summary

More withdrawals and a small output boost helped the country save cashflow.

by: William Powell

Posted in:

Natural Gas & LNG News, Europe, Corporate, Exploration & Production, Import/Export, Political, News By Country, Ukraine

Ukraine Demand Grows but Storage Saves Imports

Ukrainian state and private entities used more gas storage in 2018 in order to offset a reduction in expensive imports of gas sold at the country's western borders while avoiding Russian gas imports from Gazprom, state Naftogaz Ukrainy said January 28. The country's gas production also rose by 500mn m3 year on year, to 21bn m3.

The country imported 24.8% less in total, from 14.1bn m3 in 2017 to 10.6bn m3. Naftogaz and private companies both bought less, with Naftogaz' volumes going down from 8.7bn m3 to 7bn m(a cut of 19.5%) and private entities' purchases going down from 5.4bn m3 to 3.6bn m(a cut of 33.3%).

Naftogaz purchased gas from 18 European suppliers in 2018, a handful more than in 2017, but none of them accounted for more than 30% of the imports. Of the 8.7bn m3 that came from the west, 8.6bn m3came from the small pipeline from Slovakia, and likely to be carrying almost entirely Russian gas molecules.

The rest came from Poland, including a small volume sold in March when it became clear that Gazprom was not going to deliver gas to Ukraine after losing the Stockholm arbitration case. 

Gas demand in regulated market segments reached 16.5bn m3 against 16.8bn m3 in 2017. Household consumers used 10.6bn mof gas in 2018, which is  0.6bn m3 less than in 2017 (a cut of 5.4%). Deregulated consumers however used  500mn m3more gas, taking 14.5bn m3. Industry used 0.2bn m3 more, at 9.3bn m3.

Gas used for operational needs of production, transmission and distribution companies as well as LPG production grew by 0.3bn m3 from 4.4bn m3 to 4.7bn m3. The growth in this category was attributable to the production enhancement activities implemented by state producer UkrGazVydobuvannya last year.