Russian state-controlled gas monopoly Gazprom has delivered another hint to European authorities that they have to soften their stance on the company's Nord Stream 2 subsea pipeline project or face a potential gas shortage this winter.
Gazprom said it might be capable of exporting as much as 5.6 billion cubic metres of gas via Nord Stream 2 before the end of the year to ease Europe's energy supply deficit.
The first leg of Nord Stream 2 has already been completed, with some analysts in Moscow suggesting a trial shipment reached German transmission operator Gascade earlier this week.
Gascade later said the publication of first gas flows to Germany from Nord Stream 2 was a “technical error”.
Nord Stream 2 executives earlier said the pipeline would not be pressure tested with water for possible leaks due to stringent quality controls, and can be filled with gas after commissioning of the facilities.
This week, the eponymous operator said that completion of the second leg of Nord Stream 2 had reached 99%, with Russian pipelay barge Fortuna laying the remaining subsea segment in German waters.
Fire fallout
Meanwhile, Gazprom has not yet reported the extent of the impact on its gas production capacity at legacy fields in its core producing region of Yamal-Nenets in West Siberia from a recent fire that destroyed the first train of a major condensate processing facility near the city of New Urengoy.
Moscow business daily Kommersant said Gazprom has arranged to deliver 630,000 barrels of condensate on a monthly basis to the country’s lead gas independent, Novatek to ease the production cap on gas that flows to the surface with the condensate.
This arrangement will run until May 2022 and will utilise Novatek’s spare condensate processing capacities.
The incident has mostly affected supplies via the Yamal Pipeline running via Belarus and Poland to Germany, and Ukraine’s transit route where Gazprom opted to book just minimal additional spare transportation capacity for September.
According to Gascade, daily deliveries of Russian gas to Germany via the Yamal Pipeline have been erratic in August, falling from 58.3 million cubic metres on 1 August to a low of 19.6 MMcm on 12 August before increasing to 37 MMcm on 19 August.
Bovanenkovo challenge
Analysts in Moscow said that to fulfil its Nord Stream 2 delivery promise, Gazprom will have to arrange additional gas production at the Bovanenkovo field on the Yamal Peninsula, which is not dependent upon the New Urengoy facility, and has dedicated pipeline links to Nord Stream and Nord Stream 2.
However, this deposit reached its plateau output in February and will have to tap into deeper gas reservoirs to produce above plateau, according to operator Gazpromdobycha Nadym.
Though spot gas prices in Europe remain unseasonally high at above US$500 per thousand cubic metres, analysts point out the market does not expect the current shortfall of natural gas in Europe to extend deep into the winter period.
Seaborne supplies of liquefied natural gas from the US, Middle Asia and even the Novatek-led Yamal LNG project on the Yamal Peninsula to Europe may pick up as the unusually strong demand for LNG in Asia wanes.
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