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Inčukalns underground gas storage facility records its largest storage of natural gas

The turnover of Latvia’s single natural gas transmission and storage system operator Conexus Baltic Grid in the first six months of this year reached 32.40 million, which is 17 per cent more than in the corresponding period of the previous year, according to the data on the company’s performance in the first half of 2023. The Inčukalns Underground Gas Storage (UGS) recorded the largest storage of natural gas at the end of the first half of the year in the last five years – 13.9 terawatt-hours (TWh), including the country’s strategic natural gas reserves.

In the first half of 2023, Conexus ensured uninterrupted natural gas supplies to Latvia, Lithuania, Estonia and Finland. Market participants have successfully reoriented and secured natural gas supplies from the Klaipeda and Inkoo LNG terminals. Natural gas received from Lithuania in the first half of the year amounted to 9.2 TWh, 41 per cent more than in the first six months of last year, while natural gas received from Estonia amounted to 2.2 TWh, 6.6 times more than in the first six months of last year. With the realignment of supply flows, the total volume of natural gas transported in Latvia in the first half of the year amounted to 14.7 TWh, which is 12 per cent less than in the same period of the previous year.

In the first six months of 2023, natural gas consumption by Latvian consumers amounted to 4.3 TWh, which is 12 per cent less than in the same period of the previous year. The decrease in natural gas consumption was driven by weather conditions, which were warmer in the winter months than in the corresponding period of 2022, resulting in lower demand for natural gas for heating than in the corresponding period of the previous year, as well as unprecedentedly high natural gas prices, which led users to reduce their consumption of natural gas.

At the end of the reporting period on 30 June 2023, 13.9 TWh of natural gas was stored in Inčukalns UGS, including 1.8 TWh of national strategic natural gas reserves, the largest amount of natural gas stored in the storage facility at the end of the first half of the year in the last five years.

“The results for the first six months naturally reflect all the current market and industry trends we have been preparing for,” said Uldis Bariss, Chairman of the Board of Conexus. “Most importantly, system users will be supplied with natural gas in a targeted manner through storage at the Inčukalns Underground Gas Storage facility. All storage capacities offered in the auctions were fully auctioned. In addition, we have recorded the largest natural gas storage at the end of the first half of the year in the last five years.”

Although revenues and EBITDA were negatively impacted by the decline in transmission volumes in the reporting period, storage revenues and EBITDA were ahead of the same period of the previous year. In the period under review, Conexus posted a profit of 8 million euros, an increase of 2.68 million euros year-on-year.

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