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Jun 16, 2022
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In the drying up Nord Stream, they saw the cunning move of the Kremlin

Deliveries of Russian gas to Europe have fallen sharply in recent days. Gazprom had to turn off several turbines that provide exports via Nord Stream 1, limiting its capacity by more than half. At first glance, the problem is purely technical – in Canada, at the Siemens plant, due to sanctions, replaceable turbines were stuck in the repair. German Economy Minister Habek said that this was a political move by Russia, and the head of Gazprom, Miller, said that Nord Stream 2 could start work even now.

As early as June 14, the volume of deliveries via Nord Stream amounted to the planned 167 million cubic meters per day, then transit was reduced to 100 million, and now it has completely fallen to 67 million cubic meters. According to Gazprom, by temporarily limiting the capacity of the pipe, the monopoly is fulfilling the order of Rostekhnadzor, which refers to the development of the overhaul life of pumping units and technical malfunctions of engines at the Portovaya compressor station in the Leningrad Region.

The modernization of this equipment, delivered back in 2009, was carried out by the German company Siemens, which, due to the technological features of the contract, was forced to overhaul gas turbines at its enterprises in Montreal. However, Canada, which has joined the sanctions attack on Russia, is not going to ship repaired turbines to the customer. “We have informed the governments of Canada and Germany, and we are working on an acceptable solution,” Siemens representatives shrug.

The blow was struck at the most painful place of NS-1, since it is thanks to the capabilities of the Portovoy station that the pipeline has been operating at overdesign capacity for about four years now: with a throughput capacity of 55 billion cubic meters, in 2020-21 more than 59 billion cubic meters were pumped through the pipeline annually.

As Olga Orlova, head of the Industry direction at the Institute of Oil and Gas Technologies, notes, it will be extremely difficult for the Russian gas concern to find a replacement for Simenov’s high-capacity gas turbines, which are considered one of the most complex devices in the mining industry. There are only two major manufacturers of such units in the world: this is the American company GE, which occupies about 40% of the market, and the aforementioned Siemens, which provides at least 32% of consumer demand.

The rest of the players – the American MHPS, Solar Turbines and Pratt & Whitney, as well as the Italian Ansaldo Energia – occupy approximately 3% of the market each and are unlikely to agree to promptly provide Gazprom with equipment of satisfactory quality.

In Russia, their similar units have appeared recently and have just received project documentation. Domestic companies will be able to prepare the first gas turbine that meets the requirements of Nord Stream no earlier than next year, that is, until Gazprom has nothing to replace Siemens units with. We will have to use the reserve capacity of Portovoy, which the compressor station has in case of unscheduled repairs.

“Penalty measures against Gazprom in this case cannot be applied – due to the stoppage of pumping through the fault of the equipment manufacturer, serious questions may arise for the German concern. Europe now needs to fill storage facilities and maintain production along with residential buildings, which, due to weather conditions, consume huge amounts of electricity.

Stopping SP-1 is a much bigger problem for Europe than for Russia, since supplies have been reduced precisely because of the sanctions. Gas is also becoming more expensive because of Europe’s claims to our country. For the first time in three months, the quotes of “blue fuel” on the Dutch TTF hub have exceeded $1,500 per thousand cubic meters, so the problem of prolonging transit through the Baltic pipeline will be resolved in the coming weeks,” says Nikolay Vavilov, an expert at Total Research’s strategic research department.

As for the political aspect of Russia’s actions, we note only one “coincidence”: the decrease in gas supplies occurred against the backdrop of the visit of Macron, Scholz and Draghi to Zelensky in Kyiv and can be perceived as a Russian signal to the leaders of countries dependent on our gas, but increasing assistance to Kyiv .

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