By Nora Buli
OSLO (Reuters) – Norway, which has overtaken Russia as the biggest gas supplier to Europe in the wake of the war in Ukraine, will curtail its gas exports significantly next month due to heavy maintenance activity, with some work deferred from earlier this year.
Russian flows via the Nord Stream 1 pipeline across the Baltic to Germany will fall to zero next week as the pipeline undergoes maintenance for three days from Aug. 31, and market participants are worried they will not resume afterwards.
Low hydropower levels and French nuclear outages are also driving European gas and power prices to record or near record highs. The European benchmark gas contract traded at up to 330 euros ($330) per megawatt hour (MWh) on Thursday, its highest since March 7.
Norway supplies gas via pipelines to Britain, Germany, Belgium and France and is expected to produce some 122 billion cubic metres (bcm) of gas this year, according to official forecasts made in May, up 8% from 2021 and possibly beating a record set five years ago.
In addition to prioritising gas sales over reinjection to boost crude oil production, Norway has vowed to maintain steady supplies over the summer as Russian pipeline gas flows have been curtailed.
Pipeline gas supplies to Europe https://graphics.reuters.com/UKRAINE-CRISIS/lgvdwybzlpo/chart.png
That has meant gas pipeline operator Gassco has had to delay some planned outages.
“Some planned maintenance outages have been adjusted this year to maintain high gas supplies to Europe during the summer months,” a Gassco spokesperson confirmed in an email to Reuters.
Planned and unplanned maintenance will reduce capacity at 13 fields and processing plants throughout September, with lost volumes peaking at 154.68 million cubic feet (mcm) per day on Sept. 7, according to Gassco data.
At the same time, there is also maintenance at exit terminals in Europe and Britain, affecting where Norwegian gas will flow to next month.
Norway gas infrastructure maintenance September https://graphics.reuters.com/UKRAINE-CRISIS/klvykwwmrvg/chart.png
Maintenance should curtail overall gas production, which will drop to 323.9 mcm/day, the lowest point this year, according to a forecast from the Norwegian petroleum directorate.
($1 = 1.0010 euros)
(Reporting by Nora Buli; Editing by Nina Chestney and Jan Harvey)
Jesse Pitts has been with the Global Banking & Finance Review since 2016, serving in various capacities, including Graphic Designer, Content Publisher, and Editorial Assistant. As the sole graphic designer for the company, Jesse plays a crucial role in shaping the visual identity of Global Banking & Finance Review. Additionally, Jesse manages the publishing of content across multiple platforms, including Global Banking & Finance Review, Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune.
