Gazprom 'unlikely to act quickly' on latest FAS ruling

Source: Heren

2019/02/12

LONDON (ICIS)--Gazprom may “draw out the process” of implementing new transparency laws imposed by the Russian Federal Antimonopoly Service (FAS), a source close to the St Petersburg International Mercantile Exchange (SPIMEX) has told ICIS.

According to legislation published on 23 January, Gazprom will have to publish the precise figure of as-yet-unallocated capacities one month in advance for each of the 4,000 high-pressure exit points inside the country.

It is recognised that implementation will be an extremely difficult and complex process, and hence could take some time.

Gas transport services in Russia are provided by the state-owned monopolist. Capacity is usually bought bilaterally in the form of long-term agreements.

But long-term capacity holders do not always use these bookings on a regular basis. And the only information available to shippers active on the spot market is whatever technical capacity remains after subtracting the pre-booked figures from what is technically available.

“Contractual discipline is not very strong in the country, so it often becomes clear when Gazprom publishes usage rates post facto on its website that around 20% or 30% has gone unused, and there are no sanctions for imbalancing the system,” the source said.

“This document is a significant step forward, but Gazprom will not be able to implement it quickly,” he added, with reference to the sheer amount of exit points and the difficulty of predicting one month in advance what capacity will end up being used.

The new legislation is part of the Russian government’s road map on internal gas market liberalisation which aims towards the introduction of balancing via the exchange.

According to the FAS statement, these new transparency standards mark the final stage of the road map’s section on “increasing accessibility to energy infrastructure”.

The agency hopes that improving access to information will increase the number of network users active on the spot market.

ICIS has contacted Gazprom for more information.