Baltic LNG Terminal Deal Secures Long-Term Gas Supply for Ukraine

Long-Term Supply of Liquefied Natural Gas

According to Главком: A new agreement will provide Ukraine with a steady supply of liquefied natural gas (LNG) through the Klaipėda terminal over the long term. This breakthrough came out of intergovernmental talks held in Vilnius. According to Yuliia Svyrydenko,

“We reached an agreement on long-term LNG supply via the Klaipėda terminal during the intergovernmental consultations in Vilnius. The liquefied natural gas can be sourced from both American and Middle Eastern producers.”

The deal marks a significant step toward strengthening Ukraine’s energy security.

Lower Storage Fees and Restored Exchange Trading

In a related move, the National Energy and Utilities Regulatory Commission (NEURC) has cut the cost of gas storage in underground facilities (UGS) by 10%. The operator of these facilities, JSC Ukrtransgaz, has adopted a RAB (Regulatory Asset Base) model aimed at improving asset management efficiency.

Separately, Naftogaz Trading has resumed gas sales on the exchange. On May 20, the company sold natural gas on the Ukrainian Energy Exchange for the first time since January 2022. Notably, on May 14, it also purchased natural gas on the exchange platform for the first time in ten months.

“Our agreements will help strengthen this channel. This is an important step for our resilience,”

emphasized Yuliia Svyrydenko. These actions demonstrate Ukraine’s continued efforts to secure energy independence and diversify its gas supply sources.

These developments reflect Ukraine’s strategic focus on bolstering its energy security, especially amid external challenges. Diversifying supply sources and reducing storage costs could not only improve the country’s energy situation but also make it less vulnerable to potential crises. The resumption of exchange-based gas trading also signals a gradual return to normal functioning of Ukraine’s energy market, which is crucial for economic stability.

In addition to securing long-term LNG supplies, Ukraine is also taking steps to enhance its energy market dynamics. The recent resumption of gas sales by Naftogaz after a two-year pause highlights the country's commitment to restoring a competitive exchange environment. This move is crucial for improving energy independence, as it allows for greater market participation and price stability. For further insights into Naftogaz's return to the exchange, click here.