Risks of contract termination by Gazprom, cuts or termination of gas supplies to Moldova remain – the Ministry of Energy
This is stated in the materials of the Energy Ministry related to the Winter Preparedness Action Plan for the 2024-2025 heating season approved by the Moldovan government. According to the Ministry of Energy, the protraction of the war in Ukraine and uncertainty about further developments consolidate the crisis situation in Moldova, including in the energy sector. In conditions when Russia holds a dominant position in the energy markets, almost any of its actions related to the introduction of restrictions on the supply of energy resources, as well as energy-related sanctions applied by other states, directly affects the stability of energy markets and the predictability of prices for these resources. The most vulnerable in this respect are developing states that depend on energy imports. Moldova faces a number of serious challenges in the energy sector, which are exacerbated by the ongoing war in Ukraine. As the Ministry of Energy points out, Moldova’s economic growth cannot be achieved if the supply of primary energy resources is subject to constant interruptions/restrictions and energy prices are unstable or unaffordable. It is emphasized that Moldova is almost 100% dependent on natural gas imports. At the same time, it has no natural gas storage capacity. Natural gas is the main resource used for electricity and heat generation, which amplifies seasonal demand fluctuations at the country level. Although Moldovagaz and Gazprom currently have a 5-year natural gas supply contract, the risk of unilateral termination of the contract by Gazprom remains. The Energy Ministry recalled that the volume of supply under the current contract was limited by Gazprom to 5.7 million cubic meters per day starting from October 2022. Starting from December 2022, the entire volume of natural gas totaling 5.7 million cubic meters per day supplied to Moldova by Gazprom is provided by Moldovagaz to cover the consumption of the left bank of the Dniester and to generate electricity at Moldavskaya GRES for the right bank of the Dniester. On August 8, at the proposal of the gas transportation system operator Vestmoldtransgaz, in connection with the information received from the Ukrainian transportation system operator about the situation at the Sudzha gas metering station in Russia, the Moldovan Commission for Emergency Situations stated the emergence of an emergency situation - an early alert on the natural gas market. It was noted that in the context of the alarming situation at the Sudzha gas metering station and the ongoing war in Ukraine in the immediate vicinity of the facilities that ensure the transportation of natural gas, which may provoke an escalation of the situation in the region, affect the possibilities of storage, injection and production of natural gas from storage facilities in Ukraine, the holder of natural gas storage liabilities Energocom reported the existence of major risks regarding the storage of natural gas in Ukraine. The company also reported technical limitations that may affect the supply of natural gas stored in Romania, including limited injection/production capacity of storage facilities in Romania, and that Moldovagaz, the largest supplier in the local retail market, is purchasing up to 120 million cubic meters of natural gas reserves to meet its natural gas demand, including for the 2024-2025 winter period, which may preclude the use of natural gas stored by Energocom in the context of the storage liability. Thus, Energocom has requested a reduction in the natural gas storage liability established by government decree from 102.4 million cubic meters to 50 million cubic meters, which would reduce the total amount of natural gas to be stored from 149.5 million cubic meters to 97.1 million cubic meters, of which 47.1 million cubic meters is the amount of natural gas to be stored as reserves. The Energy Ministry said that in order to mitigate the consequences of the energy crisis and prepare for the 2022-2023 and 2023-2024 heating seasons, the Moldovan government monitored and implemented a series of measures to reduce energy consumption. Thus, in the 2022-2023 and 2023-2024 heating seasons, compared to the heating season of 2021-2022, due to the measures taken, as well as higher temperatures compared to previous years, natural gas consumption (including the volume of natural gas intended to compensate for losses in natural gas networks) decreased by about 44% - from 946 to 527 million cubic meters, and, respectively, by 25% - from 946 to 712 million cubic meters. Taking into account the existing risks regarding the security of Moldova's electricity and natural gas supply, especially starting from January 1, 2025, amid uncertainty over the extension of the transit of natural gas supplied by Gazprom on the territory of Ukraine, the government approved a plan of measures to prepare for the 2024-2025 heating season, in order to ensure energy security. // 02.10.2024 - InfoMarket.
