“Naftogaz” has signed with foreign companies a Memorandum on joint management of the GTS

“Naftogaz of Ukraine”, PJSC “Ukrtransgaz”, Snam S. p.A. (Italy) and Eustream a.s. (Slovakia) signed a Memorandum of understanding on the joint assessment of possibilities of cooperation in developing gas transportation system (GTS) of Ukraine. About it reports a press-service NAK.

According to the report, the Memorandum was signed in the presence of Minister of energy and coal industry of Ukraine Igor Nasalik, EU Commissioner for energy and climate change Miguel arias Cañete Minister of economic development of Italy Carlo calenda.

Among other things, the document aims at long-term stability of the transportation of natural gas by Ukraine in accordance with the standards of the European markets, the safe and effective use of the GTS of Ukraine, as well as transparent and non-discriminatory access to third parties in accordance with applicable law.

Under the Memorandum , the company will undertake a joint evaluation of opportunities to use and strengthen the gas transportation system of Ukraine, “to make it more efficient, modern and competitive.”

“Ukraine carries out the separation of functions of the operator of the gas transportation system from Naftogaz, the state-owned vertically-integrated holding, and expressed interest in cooperation with the Western experienced GTS operators on the use of the national transmission system in accordance with the Law of Ukraine “On natural gas market”, – noted in “Naftogaz”.

According to the press service of the NAC, the project will help improve the liquidity and security of supply in the gas market of both Ukraine and the EU, “which is fully consistent with the Strategy of energy security of the EU.”

However, the Prime Minister of Ukraine Vladimir Groisman noted that this Memorandum is just one of the initial steps towards joint management of the GTS.

“This is only a Memorandum – the position that we and our European partners must work together to manage our gas transport system, which is absolutely natural. There are still many issues that need to work to make these intentions become a reality,” – said Groisman.

“Naftogaz of Ukraine” is a vertically integrated full cycle company, including exploration, production, transportation and storage of oil and gas, as well as supply of natural and liquefied petroleum gas to consumers. In 2016, the group accounted for 79% of total gas production in Ukraine (15.9 billion cubic meters. m of 20.1 billion cubic meters), 74% of gas imports to Ukraine (8.2 billion cubic meters from 11.1 billion cubic meters) and 82 billion cubic meters of gas transit to Europe (46% of the total volume of Russian gas supplies to Europe).

“Ukrtransgaz” – the operator of one of the most powerful systems for transportation and storage of gas in the world. Naftogaz is the sole shareholder of “Ukrtransgaz”. The capacity of the GTS at the inlet exceeds 302 billion cu m/year, while output in the European direction is 151 billion cubic meters of the Ukrainian GTS connects the systems of neighboring Russia, Belarus, Poland, Slovakia, Hungary, Romania and Moldova. Through them it is integrated in the wider European gas network, while remaining the most direct and cost-effective transit route and an important element of security of gas supply in the region.

Snam uses and develops the largest and most accessible system of pipelines in the EU (longer than 40 thousand km), the largest storage infrastructure in the EU (with a capacity of 19 billion cubic meters) and one of the first LNG terminals built in Europe.

Eustream is the owner and operator of one of the largest pipeline systems in the EU. The mission of Eustream is to transport natural gas to Slovakia and through Slovakia to the European markets. Eustream’s long – standing partner of the operator of the Ukrainian gas transportation system, because it has with it a direct and bilateral communication.