Ukraine Transit Volume Down in 1Q
Ukraine's transmission system operator Ukrtransgaz said April 5 that transit flows in 1Q2018 from Russia to European countries via Ukraine decreased by 13.3% year on year to 20.1bn m3, so 3.1bn m3 less.
In contrast, transit flows for the month of March 2018 increased by 21% year on year.
Ukraine started 2018 with a five-year high in gas stocks held in underground gas storage facilities (UGS) of 14.7bn m3. This made it possible to successfully pass the six month winter 2017-2018 period, and a sustained frosty period this March, while also reducing its need for gas imports from the EU during a period of traditionally high prices on European gas hubs.
The country withdrew 7bn m3 gas from its UGS during the first three months of this year, 15% more than in January-March 2017. Gas reserves in UGS amounted to 7.5bn m3 as at April 4.
Ukraine's 1Q imports from European countries halved, thanks to its significant gas stocks in the UGS. In 1Q2018, gas exports from the EU countries declined to 1.8bn m3, down 56.9% year on year. Gas flows into UGS from gas producers in Ukraine were 5.1bn m3 during 1Q2018. Ukrainian offtakers of all categories transported 13bn m3 via principal gas pipelines, 6.7% more than in the first three months of 2017.
Ukraine is looking at spinning off the Ukrtransgaz pipeline system from its owner, state-owned gas supplier and producer Naftogaz, and said in February it started talks with European companies that are potential partners in managing the system. Gazprom is gradually reducing the amount that it transits via Ukraine but, due to its record 2017 exports, transit volume last year increased, according to Naftogaz, by 13.7% to 93.45bn m³ in full year 2017 - leading to bumper revenues for its own and the Ukrainian government's coffers.
Despite Gazprom and Naftogaz wrangling over a recent arbitration verdict, the latter said last month that the process of unbundling of Ukrtransgaz is proceeding.
(The banner photo is a compression station in Ukraine, courtesy of Ukrtransgaz)