IEVGEN TODOROV “COOPERATION BETWEEN UKRTRANSGAZ AND EUROPEAN PARTNERS – THAT`S A REAL BREAKTHROUGH”
UKRTRANSGAZ starts an informational project “Energy liberty”, in which industry specialists and experts will inform society about tendencies of the internal natural gas market. In the today's release, Ievgen Todorov talks about the first contract signed with the European gas supplier.
- The signing of the contract between UKRTRANSGAZ and French company ENGIE in Paris gives ENGIE an opportunity to transport and storage gas in Ukraine. Thus, the Government granted to the foreign companies the access to the local gas market, created competition and gave consumers the right to choose from whom to buy gas. Understandably, that it became possible not in one day. Mr. Ievgen, can you tell us more detailed about the process of the agreement preparation.
- Let`s begin from history, autumn 2013 – is a starting point of mutual relations between UKRTRANSGAZ and, at that time, GDF Suez, a legal successor of which recently became ENGIE. Exactly at that time, GDF Suez approached UKRTRANSGAZ with intention to sigh a natural gas transportation and storage contract.
On the grounds, that the acceptance of the Gas Transportation Code by EAUNRC was not regulated the relations with non-residents on internal market, in 2013, jointly with our French colleagues we drafted the gas transportation and storage agreement with non-residents.
At that moment on both sides, we were ready to sign these contracts, but taking into account the tragic events that took place in Ukraine, I mean the results of meetings in Vilnius, the students` break up in November 2013, the signing of these contracts was paused on the initiative of the international partners because of the instable situation in Ukraine.
- When it was possible to relaunch the negotiation process?
- At a later time, when Ukraine hold a course for euro integration, this lead to introduction of the amendments to legislation, after that EAUNRC was obligated to regulate all the relations with gas market residents and non-residents.
At the same time, in UKRTRANSGAS, upon an initiative of Mr. Ihor Prokopiv, the course on implementation of the best European gas transportation system operators` practices was taken. As follows, in November of the last year, the Gas Transportation and Gas Storage Codes were prepared and approved, which was a breakthrough. That is why our negotiations with a French side were relaunched.
As a result, at the end of October, representatives of UKRTRANSGAZ visited the French-Ukrainian Energy Forum, and throughout this Forum signed with non-residents - ENGIE representatives – natural gas transportation and storage contracts and their representative office in Ukraine as a registered resident.
Currently, the applications on testing delivery and its injection in storages draw up by the counteragent.
As follows, ENGIE became the first European trader who already works on Ukrainian market, which before that was limited by import and production.
- What are your impressions from the last meeting with French partners in Paris?
- We were met very warm and welcoming. Our French partners see for themselves many prospects as well, because the new market and new possibilities has been opened for them. For now, gas delivers in “transit” mode and in future the realization and its transfer to “import” mode will be planned.
- Concerning volumes of the transported gas under the signed contract, what must they be?
- This information remains confidential.
- Can the ENGIE company become a competitor to Gazprom on Ukrainian market?
- Firstly, Gazprom does not supply gas to Ukrainian market for a year, he only carries out its transportation through the soviet gas-transportation system for the European consumers` needs.
Secondly, the Russian monopolist and French ENGIE are already competitors on European market, which is why the analogical forecast can be done for scenario in Ukraine.
Accordingly, if at the same time other European traders work together with ENGIE, Gazprom will need to put efforts, including the decrease of the fuel gas price, to take up the lost position.
Due to considerable efforts of UKRTRANSGAZ, free access to the gas transportation and storage systems conditions were established. In its turn creates conditions for the increase of liquidity of natural gas market in Ukraine.
- Is there a prospect to enlarge the number of international partners?
- Such prospective is absolutely real, currently, we are on the stage of signing natural gas transportation and storage agreements with following European companies: Central Energy Trade Limited Liability Company (Hungary), DufEnergy Trading SA (Switzerland) and NORDWIND TRADE SA (Switzerland).
Despite this, UKRTRANSGAZ is at the negotiation process of signing contracts with the following companies: AOT Energy (Poland) та TrailStone Energy LLC (a representative office is in Ukraine).
I consider, that the beginning of effective collaboration between UKRTRANSGAZ and European traders is a real breakthrough, because earlier we carried out gas transit only for Russian "Gazprom", and now new perspectives opened not only to load our undergrounds gas storages in transit mode but also to carry out transit deliveries through our territory, for example, from Europe toward Balkan direction.
The next real step is to create hubs based on the Ukrainian gas storages.
The realization of the mentioned prospects will give an opportunity to increase the charge capacity of the Ukrainian gas transportation system and confirm the status of the transit country. This is very important for UKRTRANSGAZ and for Ukraine.
- Thank you, Mr. Ievgen for the interesting conversation. We are looking forward for future cooperation and waiting for great news.