Gazprom Westbound Gas via Pipeline to Germany Hits a Snag

Gas pipelines are pictured at the Atamanskaya compressor station, facility of Gazprom's Power Of Siberia project outside the far eastern town of Svobodny, in Amur region, Russia, on Nov. 29, 2019. (Maxim Shemetov/Reuters)

Russian natural gas heading westbound through the Yamal-Europe pipeline stopped on March 4, as Gazprom’s bids for additional transit capacity via Ukraine stand at high levels, according to data from the Gascade pipeline operators.

The Yamal pipeline between Poland and Germany accounts for about 15 percent of Russian gas to Europe and Turkey.

The 2,000-km (1,242-mile) pipeline from Torzhok, Russia, to Frankfurt an der Oder in Germany, can carry around 33 billion cubic meters of gas per year or 100 million cubic meters (MCM) per day.

Since the invasion of Ukraine, Gazprom has been intermittingly sending gas westward via the link in recent days amid high demand in Europe.

The conflict in Ukraine is increasing the risks of this route with each passing day.

Unstable Russian gas supplies and a high demand for energy amid an economic recovery from the pandemic have led to a spike in gas prices on the continent.

A cold snap in Europe is expected to last at least another week and is forcing consumers in the region to order more gas from Russia despite EU sanctions.

The steep drop in wind power generation this winter and the closure of nuclear power plants in Germany have been another hit to European energy supplies.

Another factor contributing to energy market tensions is uncertainty concerning Russian coal shipments to Europe.

Gazprom has also increased supplies to Europe via Ukraine, another key route in line with customers’ requests.

The German–Polish section of the pipeline since Dec. 21, has been operating in reverse, eastbound, as buyers in Poland drew on stored supplies from Germany rather than buying more Russian gas at high spot prices, driving European gas prices higher.

Gazprom on March 3 had resumed westbound natural gas supplies via the to Germany from Poland, after the flow had stopped on the pipeline earlier the same day and was expected to continue until the morning of March 4.

Flows from Poland to Germany on the pipeline had been at 5.9 million kilowatt-hours (kWh/h), while re-nominations, or preliminary bids, stood at 19.3 million kWh/h through March 4, after Gazprom booked daily capacity at auctions.

Gazprom then booked Yamal–Europe pipeline capacity for March 4 through March 5 to pump 0.8 million cubic meters of gas per hour or 7.8 million kWh/h of gas transit capacity via the pipeline.

Gas to Germany via the Mallnow metering point had stood at about 101,119 kWh/h on the morning of March 4. with about 13.5 million kWh/h overnight.

However, the reverse flow nomination from Germany to Poland was almost the same, causing the physical gas flow to come to a halt as a result of two almost identical nominations in opposite directions being fulfilled.

The Russian energy company booked an additional 1 MCM of capacity from 10:00 p.m. until the morning of March 4, according to overnight data from the GSA Platform.

The orders altogether amounted to 46 percent of all available Yamal–Europe pipeline capacity available for booking.

President Vladimir Putin has said that Russia would continue to supply gas to global markets, disregarding tightening European and American sanctions against Moscow after the invasion of Ukraine.

Russia accounts for some 40 percent of European gas demand and is also a major supplier of oil.

Despite tensions with the Kremlin over Ukraine, there has been little effort from European states to sever energy ties, other than Germany’s cancellation of the Nord Stream 2 pipeline.

Reuters contributed to this report.