What will Romania do with the gases from the Black Sea after the agreement with Ukraine / The answer of the Ministry of Energy

Ukraine has among the largest gas storage capacities in Europe, answered the Ministry of Energy, when asked by HotNews why the solution of gas storage in Ukraine is being analyzed instead of the development of additional capacities in Romania. Regarding possible gas exports from the Black Sea for consumption in Ukraine, the Ministry of Energy specified that they will be sold at market value.

Aspects related to quantities are at the stage of analysis, after the President of Romania, Nicușor Dan, and his Ukrainian counterpart, Volodymyr Zelenski, signed, last week, a framework agreement on energy cooperation between Romania and Ukraine.

The agreement provides for exploring the possibility of using underground gas deposits in Ukraine to store gas transported through the Vertical Corridor or from future production from the Black Sea.

In the agreement signed in Bucharest, Romania and Ukraine undertake “to explore the possibility of using underground gas storage facilities in Ukraine for the storage of gas coming from the Vertical Gas Corridor, as well as gas from future production from the Black Sea, within the Neptun Deep project, which will cover both Ukraine's gas needs and ensure their safe storage”.

The document drew criticism from the AUR party, especially regarding the idea of ​​gas storage in Ukraine. Senator AUR Petrișor Peiu accused Nicușor Dan of betraying the interests of the country. “Our country concluded the most shameful document in history, after the friendship treaty with a defunct USSR, concluded by the Iliescu regime on April 5, 1991! The document signed by Nicușor Dan stipulates that Romania's future gas production from the Black Sea will be stored in Ukraine in order to “ensure Ukraine's gas needs, but also store the production from the Neptun Deep field safely”, wrote Peiu on his Facebook account.

Romania will produce more gas than it will be able to consume

The gas storage capacity in Romania is around 3 billion cubic meters, which means about 30% of the national consumption. By comparison, Ukraine's total storage capacity is more than 30 billion cubic meters, a third of all EU countries combined, according to European Gas Hub data.

The operator in Ukraine is Ukrtransgaz and has been certified as a European storage operator, which means it can hold strategic gas reserves for EU member states, European Gas Hub also reports.

Starting from 2027, with the exploitation of the Black Sea gas, national production will gradually increase, above the national consumption requirement.

Romania currently produces over 9 billion cubic meters per year, and consumption is, in some years, below 10 billion cubic meters. Gas production will increase by at least 75% starting in 2027, quantities that will be difficult for the Romanian market to absorb, according to Reuters.

Senator AUR Petrișor Peiu claims that, instead of sending the gases into the Black Sea, the national chemical industry should have been reopened and developed.

“Azomureş, which normally produced half of the fertilizers needed by the country, has been closed for several years due to overpriced gas and the government wants to sell the extra extracted gas to Ukraine,” Peiu said.

We remind you that Romgaz is in negotiations with Azomureș for a possible acquisition of the industrial platform.

Gas reserves in the Black Sea are currently estimated at around 100 billion cubic meters.

How the gas storage decision will be made in Ukraine

In a response sent to HotNews' request, the Ministry of Energy says that “the document is strategic in nature and establishes the framework for exploring cooperation options, with possible concrete projects to be analyzed and developed later by the competent institutions and companies.”

Concrete amounts of gas from the Neptun Deep project in the Black Sea that could be stored in the underground deposits in Ukraine have not yet been determined, and the framework arrangement aims to explore the possibilities through which this approach will be analyzed, the Ministry of Energy claims.

“The analysis of the use of underground gas deposits in Ukraine takes into account the fact that they represent some of the largest storage capacities in Europe, which can contribute to the flexibility of the regional gas market,” the Ministry of Energy said.

Decisions regarding the use of the storage infrastructure will be made according to economic, technical and energy security criteria, the institution claims.

Any commercial agreements regarding the use of gas deposits will be negotiated directly between the operators and the companies involved, according to national and European regulations, added the Ministry of Energy

Gas exports from the Black Sea “will be done under market conditions”

Asked what quantities of gas could be exported to Ukraine, the Ministry of Energy also said that “there is no decision on the volumes of gas that could be exported to Ukraine for consumption, but only the perspective of an analysis.”

Gases from the Neptun Deep project “will be traded under market conditions, and eventual deliveries to neighboring states will depend on regional demand, available transport infrastructure and commercial contracts concluded by producers”.

The Ministry of Energy stated that currently there are no public contracts or definitive agreements regarding the use of Black Sea gas for consumption in Ukraine.

The agreement also provides for the development of the Vertical Gas Corridor connecting Greece, Bulgaria, Romania, the Republic of Moldova and Ukraine. More precisely, the project connects the gas transport infrastructure of these countries, in both directions.

For Romania, “this project means access to gas from the Caspian Sea and Azerbaijan, to liquefied gas from terminals in Greece and Turkey; capitalizing on gas from the Black Sea; increasing the transport capacity from 5.3 billion cubic meters/year to over 9 billion cubic meters/year,” the Ministry of Energy said.
Regarding the agreement with Ukraine, Prime Minister Ilie Bolojan stated that it does not automatically involve the storage of Romanian gas in Ukraine, but only creates the possibility of such solutions within the framework of regional cooperation for energy security.