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Russia’s pipeline gas exports to Europe rose by 32% to about 7.7 billion cubic meters in the first quarter of 2024, Energy Intelligence calculated based on gas transport data.
This growth was mainly due to a decline in state-owned Gazprom’s hub-related export prices, which helped Russia’s only pipeline gas exporter compete in the southeastern European market.
Gazprom’s strong supply growth in the first quarter of this year did not translate into higher revenues due to relatively low export prices. Energy Intelligence estimates that the gas giant could have generated about $2.5 billion in the first three months of this year, more than the same period in 2023, based on its own boundary price assessment. This was a 34% decrease compared to the previous year.
The momentum of the Turkish style is unstoppable
The Turk Stream pipeline operated at almost 100% of its capacity of 43 million cubic meters per day for Europe in the first quarter of 2024.
Turk Stream, which is more sensitive to price fluctuations than the Ukrainian transit route, delivered about 39 billion cubic meters to southeastern Europe from January to March, an annual increase of 48%, market sources said. Spot LNG demand in the region is said to be limited.
LNG imports through Greek import terminals, the region’s main source of LNG, fell 12% year-on-year to about 570,000 tonnes (790MMcm) in the first quarter, according to ship tracking data from commodity analysis firm Kpler. It became. Turkish import terminals reduced LNG imports by 26% to 3.8 million tons.
Supply via Ukraine also increased by 18% year-on-year to 3.8 billion cubic centimeters in the January-March period, recovering from low levels in early 2023, when Gazprom’s hublink prices were significantly higher than cooling spot prices, and central European of buyers to minimize offtake. Based on a contract with the Russian giant.
long march
Turk Stream operated above its production capacity in March, and due to the strong flow, Gazprom’s total pipeline gas exports to Europe increased by 12% from the previous month and 26% annually to approximately 2.7 Bcm, and is expected to reach approximately 2.7 Bcm by August 2023. This is the highest level since then (see graph).
The average daily flow rate through the Turkey River was approximately 46.2 MMcm/day in March, an increase of 9% from February and a significant increase of 60% from March 2023. Meanwhile, traffic in Ukraine maintained its normal level and increased slightly, with an average daily volume of about 42.3 MMcm/day. 0.4% per month, 2.5% per year.
Gazprom’s average export price is understood to have been slightly higher than in February, although European hub prices had risen at a faster pace last month after plummeting in February.
Increase in production
Higher exports contributed to Russia’s overall gas production increase in the first quarter, but the main driver was strong domestic demand amid the unusually cold weather.
Sources familiar with the data told Energy Intelligence that Russia produced about 191 Bcm in the first three months, up 9% from a year earlier.
According to sources, Russia’s gas production in March also increased by 9% from the previous year to 63.1 Bcm. Production increased by only 1.2% compared to the shorter month of February.
Arctic LNG 2 stop?
Reuters reported on April 2, citing two sources, that the first train of Novatek’s Arctic LNG 2 project has halted LNG production until at least the end of June.
Energy Intelligence previously reported that Arctic LNG 2 nearly stopped producing feedstock gas in February, either because the project was halted because storage is full and U.S. sanctions prevent it from starting commercial shipments. This suggests that they were trying to stop the liquefaction train. Lack of project operators and ice-class tankers.
According to the latest production data, Arctic LNG 2 is believed to have produced about 83 MMcm of natural gas in February, of which 49 MMcm was processed at the LNG plant, sources told Energy Intelligence.
Sources told Energy Intelligence, citing preliminary upstream data, that Arctic LNG 2 continued to produce small amounts of natural gas from its resource base, the Utlenai field, in March. Sources said Arctic LNG 2 produced just over 100 MMcm last month.
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