Moldova clinches three-year Gazprom gas supply deal

LONDON (ICIS)–Moldovan, Romanian and Ukrainian stakeholders will meet on Tuesday to discuss the delivery of gas to the Republic of Moldova after the latter has reached an agreement for a three-year supply contract with Gazprom.

Incumbent Moldovagaz said on Monday it was in the process of signing an addendum to an existing supply contract with the Russian producer for delivery covering the period 2020-2022.

Under this agreement, Moldova could receive up to 12.4 million cubic metres/day.

“To sign the contract, we need three more documents to coordinate, approve and sign – one is the contract for supply via Ukraine, the other is the interconnection agreement for the border points Oleksiivka and Grebenyky [with Ukraine] and a technical agreement for the Causeni-Orlovka measuring station between the operators of Ukraine and the Republic of Moldova,” Moldovagaz said.

Currently, Moldova is considering three supply alternatives – from Russia via Ukraine with a delivery point at the Sudzha–Valuyki border point, one on the Romanian-Ukrainian border point (Isaccea-Orlovka) or via other interconnection points along the Trans-Balkan pipeline. The pipeline has been historically used for the transport of natural gas from Russia to Turkey, Greece and Northern Macedonia via Ukraine, Moldova, Romania and Bulgaria.

Ukrtransgaz, Ukraine’s transmission system operator said last week it had completed the modernisation of the Grebenyky gas station in the southern Odessa region. This means the gas could be shipped in reverse flows from south to north into the Odessa region and the Republic of Moldova along the Trans-Balkan pipeline.

The reverse flows would depend on Ukraine signing an interconnection agreement with Romania for the Isaccea-Orlovka interconnection points.

If the parties agree on the transport details, Moldova would ensure access to natural gas. Moldova is one of Europe’s most vulnerable countries as it has depended entirely on Russian gas and does not have any gas storage.

The agreement could also secure Ukraine a transit contract for Russian gas.

Ukraine has held a 10-year transit contract with Gazprom for supplies to Europe, Moldova and Turkey. The contract expires on 31 December 2019.

Ukraine and Russia have been negotiating a new long-term contract for the supply of Russian gas to Europe from 1 January 2020, but negotiations are yet to advance.