Romania to apply EU gas network codes at non-EU borders

30/11/2020 08:50 Natural Gas

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Romanian energy regulator Anre will apply EU network codes at the country's gas border points with Ukraine and Moldova, which could support greater interconnectivity, gas flows and trading liquidity between all three markets.

Anre plans to apply EU network codes from 1 January, and is launching a consultation on the proposal that will run until 6 December.

 

Romania is directly connected to Ukraine at Isaccea-Orlovka through three strings of the Trans-Balkan pipeline (TBP) formerly used by Russia's state-controlled Gazprom to ship gas through Ukraine to southeastern European markets. The countries share a further border point at Mediesu-Aurit.

 

Moldova and Romania share a border at Ungheni. The point's recent expansion allows Moldova to import EU supply directly to its capital Chisinau for the first time, but has yet to take regular flows (see graph). Moldova plans to implement the EU's third energy package rules from 2021 and revise cross-border tariffs.

 

Romania applying EU network codes at its border with Moldova will help facilitate its reform plans.

 

Moldova's plans are similar to those already implemented by Ukraine. It has made swift progress in applying EU energy rules, regional regulator body the Energy Community has said. But at the same time it has observed that the process is still "incomplete".

 

Other countries bordering Ukraine — Poland, Hungary and Slovakia — have each already applied EU network codes at their shared gas border points, helping to facilitate increased cross-border trade and adding to Ukrainian market liquidity.

 

Poland and Hungary have each concluded virtual interconnection point (VIP) arrangements with Ukraine, expanding maximum Ukrainian import capacity from each country and further boosting interconnectivity. Talks with Slovakian system operator Eustream about the formation of a Ukraine-Slovakia VIP are ongoing.

 

Final link?


Romania applying EU network codes at its Ukrainian border, with Moldova planning to do the same, could finalise Ukraine's interconnections to EU markets.

 

But Ukraine's state-controlled system operator GTSOU and Romanian counterpart Transgaz have been at odds for a year and are yet to conclude interconnection agreements at points other than at the first string of the TBP, known as Isaccea-Orlovka I. Transgaz recently said that GTSOU "speaks another language". The operators have disagreed about minimum gas quality standards and the application of EU network codes. This is not a legal obligation as Ukraine is not an EU member, despite having implemented legislation meeting EU standards.

 

A single interconnection point at Isaccea-Orlovka I has limited the scope for cross-border flows. Capacity at the multiple cross-border points along the Ukraine-Moldova-Ukraine-Romania section is interdependent, meaning that firm bookings at several of the points can be interrupted depending on actual flows at other, technically interdependent points (see table). Flows along the route dropped sharply after Gazprom rerouted most of its southeastern European deliveries through the 31.5bn m³/yr Turkish Stream at the start of the year.

 

Multiple sets of cross-border fees have been another obstacle to market liquidity, market participants have previously said. They would prefer to use Mediesu Aurit, they said, as only a single set of fees would apply.

 

That point is also included under Ukraine's short-haul programme, unlike Isaccea-Orlovka. This provides discounted entry and exit capacity fees at Ukraine's border points with EU markets, and can be used together with its customs-free warehouse programme to ship gas between countries with limited direct connections.

 

source:argusmedia.com

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