Austria announces possible termination of gas contract with Russia

According to Ukrinform, this was stated by the Minister for Climate Protection, Environment, Energy, Mobility, Innovation and Technology of Austria Leonore Gewessler.

"Our dependence on Russian natural gas threatens the prosperity, security and future of our country. Our goal is to get rid of Russian natural gas. As a sovereign country, we cannot simply accept the fact that the share of Russian gas is increasing, not decreasing," the minister said.

According to the ministry, over the past decades, Austria has become "very dependent on Russian gas supplies". The latest significant step towards this dependence was the extension of long-term contracts for the supply of Russian natural gas in 2018. "These wrong decisions led to the fact that at the beginning of the Russian aggression, Austria was already receiving 80% of its gas from Russia," the ministry said.

Despite the federal government's efforts to reduce this dependence, the share of Russian natural gas in Austria is still "too high" and has been increasing in recent months. According to the Ministry of Energy, one of the reasons for this is that the natural gas supply contracts concluded by Austrian OMV with Gazprom provide for a fixed take-or-pay obligation. In view of this, these contracts have been called "bonded".

"This means that payment must be made in any case, even if no Russian gas is purchased. As a result of these bonded contracts, the share of Russian natural gas has been increasing amid falling overall gas consumption and unchanged imports. After all, gas consumption in Austria decreased by a quarter from 100.3 terawatt-hours in 2021 to 75.6 terawatt-hours in 2023," the agency said.

According to Gewessler, there is a clear market failure at the moment, as "there is enough non-Russian natural gas, but energy companies are not buying it". "If the market is not working, the state must intervene. I am convinced of this: It is time for a legislative commitment to diversification. And I also appeal to all those responsible in parliament - let's take the next step now," she said.

Against this background, the Ministry of Energy has proposed a number of measures that need to be enshrined in law by a constitutional majority. In particular, it is the obligation of energy companies supplying gas to Austrian consumers to "be able to replace the failure of the largest single source of supply with other sources of supply". In addition, gas suppliers "must provide evidence of a gradual increase in the share of non-Russian natural gas".

Another measure mentioned was "preparations for withdrawal from Russian contracts".

"Another reason for the high level of dependence is the bondage agreement between OMV and Gazprom, which provides for fixed obligations to purchase Russian gas. In order to refuse to supply Russian gas, as is envisaged in Austria and at the EU level, it is necessary to study and implement all options for terminating the contract," the Energy Ministry said.

It was pointed out that Gazprom has already unilaterally reduced gas supplies in 2022, and "with the expiration of the transit contract through Ukraine, there is again a risk that Russia will use gas supplies as a weapon and will not supply as much as planned." "For this reason, the Ministry of Climate Protection supports any possibility of withdrawing from the gas supply contract due to Gazprom's unilateral failure to fulfil its obligations," the statement said.

In addition, it is proposed that the rejection of Russian gas should be enshrined in Austria's new security strategy.

As Ukrinform reported, in 2018, the partially state-owned Austrian company OMV extended its gas supply contract with Russia's Gazprom until 2040.

At the time of Russia's full-scale invasion, Austria bought 79% of its natural gas from Russia.

In December 2023, Austria imported 98% of its natural gas from Russia.