Ukraine has offered EU countries to use its large warehouses to store natural gas, thereby strengthening their energy security against the coming winter. This was announced by the Ukrainian state oil and gas company Naftogaz, after its managing director, Oleksiy Chernyshov, recently met in Brussels with some representatives of the European Commission and EU gas industry.
“We want to present our deposits to Europeans,” Chernyshov announced, adding that this would “make Ukraine an energy backup for the EU.” The Naftogaz head added to Euractiv that Ukraine “has the largest gas storage capacity in Europe, with 31 billion cubic meters.” The capacity of Ukrainian warehouses is enormous, more than a quarter of what the 27 EU countries currently have and far more than Kiev’s actual needs. For this, Chernyshov offered to ‘lease’ an area of 10 billion cubic meters. “I can guarantee this free space to European countries that can store gas in Ukraine. And when they need it, they can bring it back to Europe,” he said.
For now, Kiev has legally blocked all gas exports outside the country, but that doesn’t mean European companies can’t store it in stock and then reuse it. Chernyshov acknowledged that even though Ukrainian landfills are located in deep underground geological formations and are protected from potential Russian attacks, there is “still a general risk” associated with the war that creates uncertainty for European investors. However, the option to use Kiev warehouses seems to have attracted operators, especially in a multi-year perspective.
According to a recent analysis by the Institute of Energy Economics and Financial Analysis, Europe has started a supply race, especially LNG, which could increase its annual import capacity to 400 billion cubic meters in 2030, in order not to run out of gas. against 270 in 2022. But the same study warns that there is a risk of these materials going unused in large quantities. Having additional stocks to store could be an interesting solution for those investing in gas despite EU pressure for renewables. Ukraine, on the other hand, has a domestic production capacity that could reach 19 billion cubic meters this year and increase significantly when the war is over.
Source: Today IT
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
