Service of pledged gas monitoring by the Storage System Operator of Ukraine is now available to non-residents
The Storage System Operator of Ukraine introduces the service of bank monitoring of gas stored in its underground storage facilities for non-resident customers. The first opportunity was taken by the American company ERU Management Services LLC, which stores gas in Ukrainian UGSs. One of the international financial institutions acted as a Pledgee in the tripartite agreement signed on September 30.
The service of bank monitoring of pledged gas in the UGSs calls for the conclusion of a tripartite agreement between the Storage System Operator, bank, and client. As part of the service, the Operator keeps separate records of the pledged gas volumes and guarantees their safety before the Pledgee. The bank in its turn gets a direct opportunity to monitor the volume of pledged natural gas on the client's account, and the owner can dispose of the pledged gas only after an agreement with the bank.
To be used by non-resident companies, the basic service algorithm, which the SSO launched in December 2020, had to be adapted. The changes were related to the nuances of gas metering and storage in the customs warehouse regime, which is usually used by non-resident companies. The joint work of the Storage System Operator, ERU Management Services, and the lending bank on the updated mechanism lasted around six months. In the future, the developed algorithm can be applied to similar agreements with non-resident companies which have an intention to use the service of bank monitoring of pledged gas.
«Bank monitoring of pledged gas is a service that benefits both creditors and borrowers. Banks are confident in the reliability and safety of collateral, while owners can get loans on more favorable and attractive terms. The fact that foreign companies like ERU Management Services are already interested in the service proves its indisputable relevance and demand. Therefore, we welcome all participants of the agreement and continue to expand and improve the portfolio of services of the Storage System Operator», ‒ noted Sergiy Pereloma, acting general director of Ukrtransgaz JSC.
«In the current situation with prices on the market it’s really important for traders and gas suppliers to have access to the financing and the mechanism of monitoring helps the companies to provide securities on the effective basis. We welcome such progressiveness of the Storage System Operator in the ways of cooperation with focus on real needs of the market participants», ‒ stated Dale W Perry, manager of the ERU Management Services LLC.