Russia cuts gas flows to Europe, with some stuck in Canada

Russian natural gas shipments through a key pipeline to Europe will fall by around 40% this year, state-controlled energy giant Gazprom said on Tuesday after Canadian sanctions ended the war in Ukraine prevented German partner Siemens Energy from delivering refurbished equipment.

Germany’s Supply Network Agency said it does not see gas supplies as at risk and the reduced flows through the Nord Stream 1 pipeline under the Baltic Sea are in line with commercial behavior and Russia’s previously announced gas shutdown to Denmark and the Netherlands, the German news agency dpa reported. The Federal Network Agency said it was monitoring the situation.

Spot gas prices rose in Europe, a sign of nervousness about possible further effects of the war on the supply of Russian gasthat drives industry and generates electricity on the continent.

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The European Union has outlined plans for this Reducing dependence on Russian gas by two thirds by the end of the year. Economists say a full shutdown would make a deal heavy blow to the economyConsumers and gas-intensive industries.

High energy prices are already contributing to this Record inflation of 8.1% in the 19 countries that use the euro.

Gas demand has fallen after the end of the winter heating season, but European utilities have Race to replenish memory before next winter with high prices and uncertain supplies.

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“Currently, gas supplies to the Nord Stream gas pipeline can be provided in the amount of up to 100 million cubic meters per day (compared to) the planned volume of 167 million cubic meters per day,” Gazprom said in a statement.

It did not include a timetable for the planned reduction in gas flows.

According to Siemens Energy, a gas turbine powering a compressor station on the pipeline had been in operation for more than 10 years and was shipped to Montreal for a scheduled overhaul. However, due to the sanctions imposed by Canada, the company could not return the equipment to the customer Gazprom.

“Against this background, we have informed the Canadian and German governments and are working on a sustainable solution,” Siemens Energy said in a statement.

Also on Tuesday, the federal government announced that it was granting an emergency loan to a former subsidiary of Gazprom to protect it from bankruptcy and secure the country’s gas supply.

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Germany has appointed a government agency to run Gazprom Germania In April, he said the move was temporary to “put things in order” at the company after the Kremlin-controlled parent company severed ties with its subsidiary.

Gazprom Germania, which plays a central role in trading, transporting and storing natural gas in Germany and neighboring countries, was subsequently sanctioned by Russia in a rebellion against Western sanctions against Ukraine.

The dpa quoted unnamed government officials as saying the loan would be between 9 and 10 billion euros (9.4 to 10.4 billion US dollars).

The government said the loan would “avoid bankruptcy and prevent a cascading effect on the market”.

“The money is used to secure liquidity and to procure replacement gas,” it said in a statement.

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The government added that Gazprom Germany would also be renamed Securing Energy for Europe GmbH, or SEFE for short, as a “clear signal to the market that the aim of the measures taken is to secure energy supplies in Germany and Europe.”

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https://www.local10.com/news/politics/2022/06/14/russia-lowers-gas-flows-to-europe-with-part-stuck-in-canada/ Russia cuts gas flows to Europe, with some stuck in Canada

Sarah Y. Kim

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