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Exclusive: Russia likely to restart gas exports from Nord Stream 1 on schedule – Russian sources

By:
Reuters
Updated: Jul 20, 2022, 08:51 UTC

(This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine)

Pipes at the landfall facilities of the 'Nord Stream 1' gas pipline in Lubmin

MOSCOW (Reuters) – Russian gas flows via the Nord Stream 1 pipeline are likely to restart on time on Thursday after the completion of scheduled maintenance but at lower than its full capacity, two Russian sources familiar with the export plans told Reuters.

The pipeline, which accounts for more than a third of Russian natural gas exports to the European Union, was halted for ten days of annual maintenance on July 11.

The Russian sources, speaking on condition of anonymity because of the sensitivity of the issue, told Reuters the pipeline was expected to resume operation on time, but at less than its capacity of some 160 million cubic metres (mcm) per day.

Kremlin-controlled energy giant Gazprom, cut gas exports through the route to 40% capacity last month, citing delays in the return of a turbine Siemens Energy was servicing in Canada.

“They (Gazprom) will return to the levels seen before July 11,” one of the sources said of the gas volumes expected via Nord Stream 1 from Thursday.

The benchmark Dutch front-month contract fell following the Reuters’ report that flows will resume on Thursday.

Earlier in the day, the contract traded higher after the Wall Street Journal reported that the European Commision did not expect the pipeline to restart after the maintenance.

Gazprom and Nord Stream 1 did not reply to requests for comment on Tuesday. In the past, Gazprom has restarted Nord Stream on schedule after maintenance.

Russian President Vladimir Putin said on Wednesday that the capacity of Nord Stream 1 could be reduced due to problems with other pumping units, one of which would need to be sent for maintenance on July 26.

Russia says it is a reliable supplier

Nord Stream 1, which runs on the bed of the Baltic Sea to Germany, has been in focus since Russia sent troops to Ukraine on Feb. 24 in what Moscow describes as a “special military operation”.

The West has accused Russia, the world’s largest gas exporter and second-largest crude oil supplier, of using its energy supplies as a tool of coercion.

Russia has refuted the accusations, saying it has been a reliable energy supplier.

In a letter dated July 14, however, Gazprom said it was retroactively declaring force majeure on supplies from June 14, a legal clause meaning it cannot guarantee gas delivery because of exceptional circumstances.

The Kommersant newspaper reported on Monday, citing people familiar with the situation, that Canada had sent the turbine needed for Nord Stream 1 to Germany by plane on July 17 after repair work had been completed.

Siemens Energy declined to comment.

One of the sources on Tuesday told Reuters the turbine was unlikely to be re-installed by July 21.

Germany’s economy ministry said on Monday it could not provide details of the turbine’s whereabouts.

But a spokesperson for the ministry said that the turbine was a replacement part that was meant to be used only from September, meaning its absence could not be the real reason for the fall-off in gas flows prior to the maintenance.

(Reporting by Reuters bureaux, additional reporting by Christoph Steitz in Frankfurt; editing by Barbara Lewis, Guy Faulconbridge and Louise Heavens)

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