The day CBC spoke to him last week, the CEO of Ukraine’s Gas Transmission System Operator was busy redirecting a pipeline near the northern city of Kharkiv that had just been hit by a rocket and reassuring several workers at a gas station. confiscated by separatist fighters backed by Moscow in eastern Ukraine. He was also struggling to find a way to get gas to Mariupol, whose residents have been cut off from heating and electricity since airstrikes destroyed a pipeline more than a month ago. “This is a humanitarian catastrophe right now in Mariupol,” Makogon said by telephone from an unknown location in western Ukraine, where he and his staff fled shortly after the start of the Russian invasion. “We know very well where the pipeline has been damaged, but no one can guarantee for us the safety of our personnel. This city is completely excluded from the Russian troops … That is why, unfortunately, we can not restore the supply of natural gas. gas. “ A resident of Mariupol cooks food outside an apartment building that was damaged by air raids on April 3. The city of the southern port has been without heating and electricity for more than a month. (Stringer / Reuters)

Fighting in the east threatens transit

The Makogon team is responsible for the high-pressure pipelines that transport 40 billion cubic meters of gas a year to Europe. The network is a link in a complex system of interdependence that keeps the lights on in Europe and provides critical revenue for Russia. Experts say it will not be easy to dismantle, but that it faces the biggest threat since the West began importing large quantities of natural gas from the Soviet Union in the late 1980s. “This system was created with great pride on both sides,” said Margarita Balmaceda, a professor of diplomacy and international relations at Seton Hall University in New Jersey and author of several books on Russia’s influence in the energy sector. “Engineers, designers, managers were really excited to create a system… that eventually managed to withstand all the political tensions over time, which could overcome the Iron Curtain.” Russia’s invasion of Ukraine threatens to reverse that precedent, he said, as Europe seeks to reduce its dependence on Russian gas and Russia threatens to punish countries that oppose the invasion by using their gas contracts to support the ruble. A map showing some of the main pipeline routes between Russia and Europe. (CBC)
While Europe has focused on how the current crisis is affecting its supply, the international pipelines passing through Ukraine are also affecting the way gas flows through the local network on which Ukrainians rely for heat and electricity. Since the beginning of the Russian invasion on February 25, the bombing has taken place rubbish several pipelines, compression stations and distribution points along this interconnected system, Makogon said. “Most of the damage is to low-pressure pipelines due to heavy fighting in or near cities.” A man walks past a burning gas pipeline that was hit during a bombing raid by Russian positions in northern Kharkiv on March 31. Several pipelines, compressor stations and distribution points have been damaged since Russia invaded Ukraine on February 24 (Thomas Peter / Reuters)
So far, in addition to Mariupol, pilots have found alternative ways to deliver gas to damaged areas, he said, but is increasingly concerned about the Novopskov compressor station. It is located on the route of the Soyuz pipeline that transports gas to Europe through the breakaway region of Luhansk in eastern Ukraine, where the conflict has escalated in recent days. Makogon warned last Friday that the gas supply could be jeopardized if the fighters occupying the station since the start of the invasion interfere with its operation. “If we can not operate the station remotely … we will have to close the crossing for that connection point,” he told CBC. “We’re really worried about … this whole area to the east.” Russia’s state-owned Gazprom said in an email to the CBC that it was supplying gas for transit through Ukraine as usual and “according to the demands of European consumers.” Sergiy Makogon oversees the high-pressure pipeline system that carries 40 billion cubic meters of gas a year to Europe via Ukraine. (Submitted by Sergiy Makogon)

“Energy air defense”

Ukraine is one of the four main pipelines through which Russian gas flows to northern, central and southern Europe, which together supply about 45 percent of gas imported by the EU. It does not import gas from Russia, but receives about $ 100 million a month to ensure it reaches Europe. Most importantly, Makogon said, it ensures that Russia can raise about $ 900 million a day from selling gas to Europe. “We call it our energy defense,” he said. “We believe that as long as we have transit, the Russians will not deliberately destroy our infrastructure and we will be able to deliver gas to our local population.” (CBC)
Ultimately, Ukraine would like to see Europe impose a full embargo on Russian oil and gas, but realizes that a phasing out is more likely, Makogon said. “We understand that, unfortunately, Europe is overly dependent on Russian gas.” Russia, for its part, is in no hurry to cut the flow of revenue generated by Europe’s energy demands, Balmaceda said. He made 99 billion euros ($ 136 billion Cdn) last year from EU oil and gas sales. “The reality is that they need these sources of income,” he said. Balmaceda said there were only a handful of times Russia used supply disruption as a lever: in 2006 and 2009 in price disputes with Ukraine and last autumn, when it cut gas supplies to pressure European partners to speed up. the certification of the North. The Stream 2 pipeline to Germany, which has now been suspended due to Russia’s recognition of the breakaway republics in eastern Ukraine. “They have really worked on the idea of ​​being a trusted supplier,” said Balmaceda, who also works at the Davis Center for Russian and Eurasian Studies at Harvard University and the Harvard Ukrainian Research Institute. While Gazprom said in an email to the CBC that it “continues to provide reliable gas exports to consumers,” it also said it would follow Russian President Vladimir Putin’s mandate that requires “unfriendly” countries to transfer foreign currency payments for Russian gas in ruble bills. A Russian construction worker speaks on a mobile phone during a ceremony marking the start of construction of the Nord Stream 1 pipeline in Portovaya Bay northwest of St. Petersburg, Russia, in April 2010. The pipeline carries gas to Germany, which gets more than 60 percent of its gas from Russia. (Dmitry Lovetsky / The Associated Press)

The options for expansion to the east are limited

It is unclear whether Russia will cut off supplies to those who do not comply, but Carlos Torres Diaz, an analyst at Rystad Energy, an energy market research firm in Oslo, says diverting gas to other markets would not be something Russia would do. can do it quickly and easily. Russia has been expanding its gas exports to China in recent years, but its current pipeline to the region is not connected to the gas fields of Western Siberia and Yamal, where Europe’s gas comes from, so diverting this supply would require the construction of new connections, expansion projects that are at risk due to sanctions imposed on Russia for its invasion of Ukraine. “Many of these infrastructures were developed with Western companies like Exxon, for example, but are being withdrawn,” said Torres Diaz. Europe, for its part, took a step towards weaning Russian energy last week ban on imports of Russian coal starting in August, but doing the same for gas would be much harder, Torres Diaz said. A billboard near Svobodny in the Amur region of eastern Siberia advertises Gazprom’s Power of Siberia pipeline, which is part of Russia’s plan to expand gas exports to China. (Maxim Shemetov / Reuters)

The EU looks forward to LNG, renewable energy sources

Diaz and other analysts say European countries should try to build gas storage facilities next winter and meet the European Commission (EC) ambitious goal of halving Russian gas imports by two-thirds by the end of the year and the phasing out of all fossil fuel imports from Russia by 2030. Finding a way to replace the 155 billion cubic meters of gas Europe imports from Russia would mean increasing sources such as liquefied natural gas or LNG, which is shipped and refueled on the other side. Efforts to replace gas from Russia with LNG are limited by existing supply, however, much of which is linked to long-term contracts. New projects are not expected to be released until 2024 or 2025. “The main source of increased supplies would be the US because it is one of the closest markets and also because the US has the most flexibility with LNG supplies as it does not sell that much volume in long-term contracts,” said Torres Diaz. . Snow-covered transmission lines can be seen at the Dominion Cove Point liquefied natural gas terminal in Lusby, Md. The United States has agreed to increase LNG supplies to Europe to help replace Russian gas. (Gary Cameron / Reuters)
Europe is competing with Asia for LNG available in the so-called spot market, and while recent record high prices make its diversion to Europe an attractive option, this may not be the case next winter, said Anne-Sophie Corbeau, a company with based in Paris. researcher at the Center for Global Energy Policy in New …