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EU ministers back option to limit Russian gas, LNG bookings


30 Mar 2023 09:48




29 Mar 2023 08:34

(Montel) EU countries would have the option to temporarily limit access to capacity for Russian pipeline gas and LNG on supply security grounds under draft changes made by energy ministers to the bloc’s gas market rules.

EU energy commissioner Kadri Simson welcomed this addition to the rules, which still need to be discussed and agreed with the European Parliament before they can become binding, she said late on Tuesday after the ministers’ meeting.

“It is clear that we will not go back to the status quo with Russia as our main gas supplier,” she said. “We need to protect our security of supply.”

Russia used to supply around 40% of the EU’s gas but since the war in Ukraine started last year the bloc has set itself a goal to end this reliance and diversify its sources.

The draft changes would allow national governments to limit for a fixed time up-front bidding for capacity by any single network user for deliveries from Russia or Belarus into their pipeline grid or LNG terminals under certain conditions.

These include that such limits do not disrupt the EU’s internal gas market or undermine supply security of any EU country or the bloc as a whole.

Governments would have to consult first with the European Commission and any other countries that might be affected by the limits, including the EU’s neighbours such as Norway and the UK, and take “the utmost account” of any concerns they raise.

The changes are part of the ministers’ negotiating position agreed on Tuesday on the EU’s internal market regulation for hydrogen, renewable and natural gases. The next step is to start talks with parliament to agree on the common text needed for the regulation to become binding.

Finding alternatives
According to London-based research consultancy Energy Aspects, European imports of Russian pipeline gas should fall by around 60% this year to around 23bcm, although the region is still on track to meet storage targets.

Last month the EU banned Russians from booking gas storage as part of formal sanctions to pressure Russia to end its war in Ukraine.

But it specifically excluded LNG terminals as there were no reports of Russians hoarding capacity in them.

Simson has also urged companies to stop importing Russian LNG – volumes reached 20bcm in 2022 – but there are no official EU sanctions preventing this.

The US became the EU’s main LNG supplier in 2022 with 56.4bcm, 34bcm more than in 2021, while total LNG imports to the EU rose to 135bcm from 80bcm, said Simson.

She expected LNG imports to continue this year at these “sustained levels”.

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