Ukraine's Bid To Increase Europe's Gas Storage Capacity

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Ukraine's Bid To Increase Europe's Gas Storage Capacity

Ukraine on the map (© Shutterstock/hyotographics)
Ukraine on the map (© Shutterstock/hyotographics)

Among Ukraine's many physical attributes is an extensive underground gas storage and pipeline network. The total active capacity of Ukrainian UGS facilities is over 30 bcm. These are the largest storage facilities in Europe and the third largest in the world that attracts gas storage customers, including European customers.  It is this gas infrastructure that has confirmed its readiness to store and re-export European gas under the stress-test scenarios for the 2023/2024.

According to USAID, the authorities of Ukraine and state-owned gas operators with the support of international partners carried out modeling and assessment of the risks of Russian military aggression on the ability of European traders to safely store gas in Ukraine and transport it to Europe under the stress-test scenarios for 2023/2024 winter season.

In addition to confirming the country's readiness to store and re-export gas to Europe, GTSOU, with the support of the Ministry of Energy, is working to reduce concerns about security risks on the part of international customers, who are interested in storing gas in Ukraine.

Based on results of performed technical analysis, the working group reached the following conclusions:

  • It is possible to re-export the amount of gas that is expected to be accumulated in UTG’s gas storage facilities in customs warehouse mode from Ukraine to the EU under the analyzed stress-test scenarios. This is possible regardless of whether the gas evacuation must occur in a shorter period or if it will take place across the entire winter season, until the end of March 2024.
  • Ukraine’s gas infrastructure has high reliability and resilience due to significant reserve capacities that were used to regulate export regimes during the crisis situations modeled.
  • Different combinations of transportation routes between storage facilities and the Ukraine-EU cross-border points were confirmed; these can substitute for one another and allow the quick switching of routes at very short notice.
  • At the time of writing, EU gas storage facilities exceeded 90 percent of their capacity. This means using the additional available gas storage facilities in Ukraine will be important to guarantee continuous energy availability for the EU member states and mitigate spikes in spot market prices. While Ukraine boasts the largest storage capacities in Europe and the third largest globally, attracting European traders to use these extensive facilities requires more than just market conditions (which are already in place); it also requires an analysis due to  Russia’s ongoing war against Ukraine.

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