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Moldova, Ukraine and Slovakia join Vertical Corridor gas infrastructure project

Gas transmission system (GTS) operators of the Vertical Corridor project DESFA (Greece), Bulgartransgaz (Bulgaria), FGSZ (Hungary), Transgaz (Romania), ICGB (Bulgaria) and Gastrade (Greece) have agreed to extend their original Memorandum of Understanding (MoU) agreement adding Eustream (Slovakia), GTSOU (Ukraine) and Vestmoldtransgaz (Moldova) to the initiative.

This decision was made on Friday (19 January) on the sidelines of a ministerial meeting of the High-Level Group on Central and South Eastern Europe Energy Connectivity (CESEC). 

In a closed meeting, TSOs also informed Energy Commissioner Kadri Simson about the developments of the initiative. The Commissioner acknowledged the strategic value of the Vertical Corridor and implied that it would be treated as a priority project. She also emphasised the necessity to remove all remaining regulatory barriers in the realisation of the regional initiative, as informed by Hungarian TSO FGSZ.

Through the appropriate upgrading of the respective networks, grid operators aim to facilitate the transport of gas from the south to the north and vice versa, responding in a coordinated manner to the need to strengthen energy security and diversification in the region. TSOs also underlined that the implementation of the respective projects will likely require public support and financing.

Hungarian gas TSO, FGSZ has emphasised that de-bottlenecking of the Vertical Corridor route is necessary to support the simultaneous supply of Black Sea gas and other sources from the South towards Central Europe.

The interconnector’s capacity expansion plans to reach 5 billion cubic metres per year (bcm/y) would be of significant importance to enable accommodating 10 bcm/y of LNG from the terminals Greece and Caspian gas through the Southern Gas Corridor to reach Moldova, Ukraine, Hungary and Slovakia.

“The IGB gas pipeline currently operates at 3 bcm/y, but given the region’s dynamics and market’s demand, we’re already working on expanding this capacity to reach 5 bcm/y. This will be of immense importance to allow the import of larger quantities of LNG from the south via IGB and through the Trans-Balkan gas pipeline to reach the Moldovan and Ukrainian markets, Hungary, and Slovakia,” said ICGB’s Executive Officers Teodora Georgieva and George Satlas. According to them, with this strategic step, the Vertical Gas Corridor becomes a more competitive corridor for European users, strengthening Europe’s energy independence and diversification of supplies.

All transmission system operators have agreed to carry out simultaneously, in July 2024, one year earlier than the foreseen schedule, a binding market test for capacity allocation at their respective interconnection points. Based on the expressed market interest, capacity expansion projects would be implemented to meet the demand along the Vertical Corridor route.

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