Increased by more than 30%. Gas prices soar again in Europe

David JackySeptember 11, 2022

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London-based ICE data show that against the backdrop of the shutdown of the Nord Stream, gas prices in Europe soared above $2,900 per thousand cubic meters at the opening of trading on Monday. They grew by more than 30%.

October futures, according to the index of the largest European hub TTF, opened trading at $2,810.5 per thousand cubic meters (+26.6%), RIA Novosti reports. Prices reached a maximum of 2917.4 dollars per thousand cubic meters (31.4%). Then futures traded at $2,733.2 per thousand cubic meters (+23%).

On August 19, a message appeared on Gazprom’s Telegram channel that from August 31, “the only working gas compressor unit Trent 60 will be stopped for three days for maintenance and scheduled preventive work.” The company noted that a set of routine maintenance, “according to the current maintenance contract, will be carried out jointly with Siemens specialists .” However, Siemens later began to deny the participation of their employees in the repair.

Gazprom also explained that “in accordance with the technical documentation of Siemens, it is necessary to carry out maintenance of the unit every 1000 hours.” It includes “examination of the hull for cracks, potholes, deformations, burn spots, cleaning the hull; inspection of oil supply systems, air, removal of combustion gases for leaks, broaching of connections and elimination of causes of leaks; checking the safety valves and setting the air flow control system.

The Russian company then promised that “on the fact of the completion of work and the absence of technical malfunctions of the unit”, gas transportation will be restored on September 2 to the level of 33 million cubic meters. m per day.

Indefinite shutdown of Nord Stream
On September 2, it became known that Nord Stream could not be launched on the promised date, as the gas-pumping unit Trent 60 was “detected to leak oil with an admixture of a sealing compound through the connectors of the terminal connections of the cable lines of the low and intermediate rotor speed sensors.”

“Oil has been detected on the cable plug connection of the BPE2 subplate included in the engine. Oil was also found in the area of the cable line in the external terminal box of the GPA automatic control system outside the noise and heat insulating casing. The act of detecting an oil leak was also signed by representatives of Siemens,” Gazprom’s Telegrm channel reported.

The company clarified that they received a warning from Rostekhnadzor that “the detected malfunctions and damages do not allow for the safe trouble-free operation of the gas turbine engine.”

“It is necessary <…> to suspend the further operation of the Trent 60 gas compressor unit in connection with the identified gross violations <…> Until the comments on the operation of the equipment are eliminated, gas transport to the Nord Stream gas pipeline has been completely stopped,” the Russian company said.

Gazprom also said that a letter about the identified malfunctions of the Trent 60 unit and the need to eliminate them was “sent to the President and CEO of Siemens Energy AG, Christian Bruch.”

“Siemens takes part in the repair work in accordance with the current contract, detects malfunctions, signs an oil leak detection report, and is ready to fix them. Only there is nowhere to repair, ”Gazprom’s Telegram message dated September 3 says.

The shutdown of Nord Stream deprived European countries of 33 million cubic meters of gas per day and, accordingly, one billion cubic meters per month. Gas deliveries through this pipeline have been gradually declining since mid-June, when the repair of Nord Stream turbines fell under new Canadian sanctions. In particular, one of the turbines got stuck during repairs in Canada.

On June 14, Gazprom was forced to limit work at the Portovaya compressor station, which pumps gas into Nord Stream, “due to the untimely return of gas pumping units from repair by the German company Siemens”: gas supplies fell to 100 million cubic meters. m per day. Already on June 15, the company announced that it was “stopping the operation of another Siemens gas turbine engine, then the daily capacity of the compressor station decreased to 67 million cubic meters. m per day.

Since the end of July, the pipeline has been producing only 20% of its nearly 170 million cubic meters of throughput capacity per day, since only one turbine began to provide the operation of Nord Stream 1.

In the summer, Nord Stream 1 was already shutting down. On July 11, both strings of the gas pipeline were shut down for 10 days for annual scheduled maintenance, including testing of mechanical components and automation systems. At that time, Russian gas continued to flow to European countries through only one transit line through Ukraine.