Q Club

Natural Gas

In 2005, gas consumption totaled 76.4 billion cubic meters, including 18.0 bcm by the population, and 7.5 bcm for in-process needs of gas producing and gas transmission companies.

Import, Export

Based on natural gas supply and distribution data, Ukraine's import (from the Russian Federation and Central Asia) for its own needs totaled 55.9 bcm in 2005.

When formulating the strategy for export policy, NJSC Naftogaz of Ukraine is switching from spot agreements to long-term contracts for sale of hydrocarbons, specifying sale prices based on formulas that take into account changes in world prices for hydrocarbons.

In future, gas can be imported to Ukraine from the following sources: Turkmenistan, Kazakhstan (using the operating gas pipeline system), Azerbaijan, Iran, Iraq, including the projected Nabucco gas pipeline (which is being develop by the INOGATE program under the auspices of the EU), routed through Turkey, Bulgaria, Romania, and Hungary.

Nabucco Gas Pipeline Route and Possible Options for Natural Gas Supply to Ukraine Using Bulgarian and Turkish Gas Pipeline Sections

Ukraine may join this system and is interested in implementing this project. Among possible options for natural gas supply to Ukraine using Nabucco gas pipeline it is worthwhile specifying the following:

  • gas supply in the reverse direction by the disengaged gas pipeline from Lozinets compressor station (Bulgaria) to Izmail (Ukraine);
  • supply of compressed or liquefied gas from Black Sea ports of Trabzon (Turkey) or Supsa (Georgia) to Ukraine (Odessa, Feodosiya). This will require laying branch pipelines: from Nabucco to Trabzon in the first case, and from Baku-Tbilisi-Erzurum gas pipeline to Supsa;
  • replacing by Russian gas at the Ukraine – Russia border.

Alternatively, gas can be supplied to Ukraine and Europe by the Iran – Europe route and the new Turkmenistan – Europe routes that would pass through Ukraine.

The history of changes in their export potential counts to favor of these specific countries.

History of Changes in Natural Gas Export Potential of Iran, bcm

History of Changes in Natural Gas Export Potential of Iran, bcm

  • Export potential,bcm (forecast)
  • Export, bcm (accordance with concluded contracts)

History of Changes in Natural Gas Export Potential of Turkmenistan, bcm

History of Changes in Natural Gas Export Potential of Turkmenistan, bcm

  • Export potential,bcm (forecast by Turkmenistan Goverment)
  • Export, bcm (accordance with concluded contracts)

Selection of specific options for natural gas supply to Ukraine requires a more detailed feasibility study that should be carried out in the framework of the program for diversification of natural gas supply to Ukraine.

The choice of specific options as regards diversification of natural gas supply to Ukraine requires a more detailed feasibility study that should be carried out in the framework of the program for diversification of natural gas supply to Ukraine.

The possible options for natural gas supply to Ukraine should be considered taking into account the following objective factors:

  • diversification sources and routes of gas supply to Ukraine is a strategic goal for a long-term period;
  • currently, natural gas supplied to Ukraine from alternative sources is more expensive than natural gas transported through or from Russia;
  • alternative sources and routes of gas supply to Ukraine should be agreed with the prospects for gas supply to EU countries as provided under the INOGATE program;
  • implementation of alternative projects regarding gas supply to Ukraine should be carried out in the framework of consortia established therefore.