Kremlin: gas transit through Ukraine may be maintained after Nord Stream 2 launch

Kremlin: gas transit through Ukraine may be maintained after Nord Stream 2 launch

Russia may continue gas deliveries to Europe through Ukraine after the launch of Nord Stream 2 gas pipeline, the Kremlin spokesman Dmitry Peskov said when asked whether Russia might guarantee such transit supplies.

The Kremlin spokesman recalled that Russian President Vladimir Putin had repeatedly said about that earlier as well. "He said that the issue is not about suspension of transit supplies through Ukraine after Nord Stream 2 is commissioned," TASS cited Peskov as saying.

"Transit supplies might be maintained further on, though everything depends on the Ukrainian side," the spokesman concluded.

Last week, German Chancellor Angela Merkel stressed that Ukraine's role as a transit country should be preserved after the Nord Stream 2 is launched. 

The Nord Stream 2 pipeline is expected to come into service at the end of 2019. The pipeline is set to run from the Russian coast along the Baltic Sea bed to the German shore. Each of the pipeline’s two stretches will have a capacity of 27.5 bln cubic meters. The total cost of the project has been estimated at 9.5 bln euro.

Deputy director of energy policy of the Institute of Energy and Finances, Alexey Belogoriev, speaking to Vestnik Kavkaza, noted that the preservation of Ukraine's transit remains a political condition for the construction of Nord Stream 2, put by Germany. "Germany is Gazprom’s key partner in the Nord Stream 2 project, and therefore we cannot abandon Ukrainian transit for political reasons. In addition, regardless of the demand for Russian gas in Europe, Gazprom will need Ukraine’s transit system as a large reserve capacity in case of an unexpected growth in demand. Such a growth can be associated with increasing market needs and seasonal fluctuations. Gazprom is the traditional closing supplier, and it does not have other reserve capacities except for Ukraine," he pointed out.

"By the way, this fact will fundamentally change the role of Ukraine's role: if now it is the main corridor of Russian gas supplies, then, starting from 2021, it will become the main source of reserve supplies. In order to maintain such reserve capacity, one must pay for them and maintain in working condition. In this regard, it will be necessary to continue to supply gas to Europe in two directions: 20-26 billion cubic meters a year to Slovakia and 5-6 billion cubic meters a year to Bulgaria and Moldova via the trans-Balkan route," Belogoryev stressed. 

"Russia is ready to sign a new transit contract, even two: one for 2020 with rather large volumes, related to the fact that neither Nord Stream 2 nor Turkish Stream can be put into full operation so quickly - and the other for 2021 and beyond," the expert said.

"The volume of transportation will be reduced three times, which means that the entire system must be rebuilt, and this is a very serious challenge for Ukraine and Naftogaz. The problem is that the current transit contract was signed with Naftogaz, and the government of Ukraine has not been able to separate state systems from Naftogaz," Alexei Belogoryev concluded.

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