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Analysis confirms Ukraine’s readiness to store and re-export European gas under stress-test scenarios

Ukrainian authorities and state-owned gas operators have conducted a risk analysis of Russian military aggression on European traders being able to store gas in Ukraine and re-export it to Europe under stress-test scenarios for the 2023/2024 winter season (31 August).

The Gas Transmission System Operator of Ukraine (GTSOU), with the support of Ukraine’s Energy Ministry, initiated the analysis to confirm the readiness of the Ukrainian gas infrastructure for the heating season of 2023/2024, as well as reduce concerns about security risks on the part of international customers, who are interested in storing gas in Ukraine.

The stress test was jointly conducted by the GTSOU, Ukrainian Energy Ministry, USAID Energy Security Project, Energy Community Secretariat, Directorate General “Joint Research Centre” of the European Commission, Ukrtransgaz, Naftogaz and Simone Research Group.

Key findings

Firstly, it is possible to re-export the amount of gas that is expected to be accumulated in Ukrtransgaz’s gas storage facilities in customs warehouse mode from Ukraine to the EU under the analysed stress-test scenarios, according to the analysis. This is possible regardless of whether the gas evacuation must occur in a shorter period or if it would take place across the entire winter season, until the end of March 2024.

Secondly, Ukraine’s gas infrastructure has high reliability and resilience due to significant reserve capacities that were used to regulate export regimes during the crisis situations modelled, the analysis said.

Thirdly, different combinations of transportation routes between storage facilities and the Ukraine-EU cross-border points were confirmed; these can substitute for one another and allow the quick switching of routes at very short notice, the analysis further noted.

“Considering that European storage facilities—driven by Regulation (EU) 2022/10321—have reached around 90 per cent of their capacity as of August 23, 2023, the additional available gas storage facilities in Ukraine offer the EU an important option to ensure uninterrupted energy availability and mitigate price spikes in the spot market,” the document read.

Ukraine has the largest gas storage capacities in Europe and the third largest in the world.

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