Ukraine Expands Storage Benefits

Ukraine's gas transmission system operator Ukrtransgaz is offering foreign customers spare capacity in its giant storage facilities for over 1,000 days without paying customs duties. The current limit is 31 days.

The plan could save investors the cost of developing gas storage in neighbouring countries where there is a shortage, such as Bulgaria; but it would also damage existing operators in Germany, Austria and elsewhere who are struggling to cover their costs in the low seasonal spread environment.

The storage services are offered at the most competitive prices in Europe, or about €0.4/MWh/cycle, it said.

“The launch of the customs gas warehouse in Ukraine is an important step in our long-term strategy to integrate into the European gas market and create an eastern European gas hub based on Ukraine's vast and reliable gas transmission and storage infrastructure”, said the acting president of Ukrtransgaz Myroslav Khymko in a statement June 16.

With the new option, all gas traders are able to store their gas in the Ukrainian territory for up to 1095 days without paying taxes and customs duties if the gas is going to be transported away from Ukraine. All legal barriers have been thus removed in Ukrainian regulations for providing non-residents with the services of gas storage in UGS facilities, it said.

Ukrtransgaz operates the largest underground gas storage facilities in Europe with a total capacity of 31bn m³. In recent years the Ukrainian storage capacities have under half used so the company is offering the available free storage capacities to foreign traders. 

William Powell