Ukrtransgaz Buys Hub-priced Gas on Platform

State transporter Ukrtransgaz has bought gas for balancing purposes and for compressor stations for delivery between April and December on the electronic trading platform Prozorro, it said April 20. This is the first time it has done so. “Thanks to breaking up the tender into ten lots, each of 218mn m³, seven suppliers offered gas,” it said.

Prices ranged from hryvnia 5,920 to 6,396 (roughly $220 to $238) per ’000 m³ net of VAT and transportation costs, compared with the expected price of hryvnia 7,670, it said. However it also said that the price for each month would be indexed against the west European hub, NetConnect Germany (NCG), thus guaranteeing a market level for Ukrtransgaz.

Ukrtransgaz told NGW that there is a contract attached to the tender and the tender price was calculated based on delivery over the balance of April at NCG. According to the terms the actual price paid in May-December will be calculated with adjustments to the daily NCG price changes to that balance of month price.

Winners included parent company Naftogaz Ukrainy which achieved the highest price (three lots totalling hryvnia 4.12bn, or $153mn). The other winners each sold one lot: Eru Trading and Trafigura Ukraine each got hryvnia 1.35bn ($50mn); a gas trading company Gazotorgovaya kompaniya got hryvnia 1.33bn and an energy service company Esko-Pivnich got hryvnia 1.29bn ($48mn).

At the start of autumn Ukrtransgaz plans to carry out its next purchase of gas on competitive market, taking advantage of the growing number of Ukraine’s gas suppliers, it said. Last year there were 34 independent suppliers.

William Powell