Naftogaz has ‘plan B’ if Gazprom stops gas transit via Ukraine

The Naftogaz group considers an option of complete termination of Russian gas transit via the territory of Ukraine and elaborates the measures that could ensure the energy security of Ukraine under those circumstances.

Andriy Kobolyev, the Chairman of the Executive Board of NJSC Naftogaz of Ukraine, said this during a round table meeting dedicated to further gas transit via the territory of Ukraine, which was held in Brussels on Friday, an Ukrinform correspondent reports.

"There is a proposal to create additional gas storage facilities in Ukraine, this work is now underway, and this should ensure our energy security. We are also working to enhance our capabilities to import from the European Union, and we are convinced that the liquefied gas terminals will be able to fully replace Russian gas if Gazprom decides to choose this option. And the third point, if we consider the gas supplies to Ukraine on other routes. As we understand, many other countries and gas dealers also create additional opportunities for gas supplies in Europe itself, which is already able to withstand a potential gas crisis. Therefore, the short answer is: more storage facilities and more liquefied gas," Kobolyev said when asked whether Naftogaz has a "plan B" in case of absence of gas transit.

As a reminder, the gas transit contract between Naftogaz of Ukraine and Russian Gazprom ends at the end of 2019.

The Nord Stream 2 gas pipeline is being built from Russia to Germany bypassing Ukraine through the Baltic Sea. The route covers over 1,200 kilometers. The total capacity of Nord Stream 2 is 55 billion cubic meters of gas a year.

Ukraine argues against the construction of Nord Stream 2 because of the possible loss of the status of a transit country. In addition, the opponents of Nord Stream 2 are the United States, Poland, and the Baltic states, warning the EU against the dependence on Russian gas.

On February 28, 2018, the Arbitration Institute of the Stockholm Chamber of Commerce satisfied the demands of Naftogaz of Ukraine regarding the transit contract with Gazprom. According to the ruling, Naftogaz should be paid compensation worth $4.63 billion for Gazprom’s failure to deliver agreed transit gas volumes.

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