Russia's Gazprom cuts gas deliveries to Romania by 10%

By bne IntelliNews September 16, 2014

Gazprom’s regional dispatch in Bulgaria's Sofia has informed Romanian gas transport company Transgaz that there will be a 10% cut in the planned deliveries, energy minister Razvan Nicolescu was quoted as saying by HotNews. Gazprom has not explained the reasons for the reduction, the report said.

Similar cuts were already announced over the weekend but they were not followed by lower deliveries, except for a 5% reduction on Friday.

The 10% cut is totally insignificant since in the summer period Romania produces twice as much gas as it consumes.

Romania’s energy system can furthermore run with no malfunction by next spring even if Gazprom disrupts totally its deliveries, Nicolescu assured. The country's reserves are already 0.7bn m3 above the 1.8bn m3 requirements set by energy market regulator ANRE, he said. By the end of the injection cycle [injection into natural reservoirs] the reserves will probably hit 2.8bn m3, Nicolescu added.

Romania’s annual gas consumption is around 12.5bn m3, of which some 11bn m3 is produced domestically.

IntelliNews Comment. Gazprom’s lower deliveries to Romania are part of a broader campaign of similar actions in the region, in response to Europe’s set of sanctions against Moscow related to the crisis in Ukraine. Romania’s gas industry was developed to be self-sufficient and is largely insulated from its neighbours – therefore the disruptions can only discourage plans for gas exports and increase tensions among Romanian officials. The European Commission already pressures Romania for terminating the preferential gas supplies to local households and for liberalising the gas export – in an effort to make the Romanian gas resources available to all European consumers under the single market.

Romania however cannot technically supply gas to its neighbours except for limited deliveries to Moldova - 14,000 m3 per hour, which is 3% of the neighbouring country’s average consumption, Nicolescu explained. The interconnector will however be further expanded to deliver 1.5-2bn m3 of gas per year, which is above Moldova’s 1.1bn m3 current annual consumption.

Separately, the industrialised pro-Russian separatist region of Transnistria imports and consumes another 1bn m3 of Russian gas. The capacity of the gas interconnector with Moldova is scheduled to reach a maximum at the moment when OMV Petrom and ExxonMobil are supposed to start deliveries of offshore natural gas from the Black Sea – thus making Romania a net exporter of gas.

On the other hand, the Arad-Szeged pipeline to Hungary was primarily designed to bring gas to Romania and not export it from there. It still can carry only 10,000 m3 per hour [less than 0.1bn m3 per year] to Hungary, but its export capacity is planned to reach 4.4bn m3 per year by 2016. Exports to Hungary could in principle further be directed to Ukraine or other European countries.

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