Germany has the largest natural gas storage capacity in the EU. There are about 40 underground gas storage facilities (UGS) in the territory of Germany, into which approximately 23 billion cubic meters of blue fuel can be pumped. Most operators of these UGSFs are members of the industry association INES (Initiative Energien Speichern) headquartered in Berlin. Recently, it has also represented the interests of companies developing hydrogen storage projects. DW spoke with INES CEO Sebastian Bleschke about whether Germany’s natural gas reserves will last until the end of the heating season.
DW: Probably never before German gas storages, and especially their filling levels, did not attract the same international interest as they do now. This is due to fears that the EU’s largest country could face interruptions in the supply of heat and electricity until spring, as natural gas reserves are extremely low this year. What is the situation at the end of January?
Sebastian Flash: Germany ranks fourth in the world in terms of natural gas storage capacity, and this is probably one of the reasons why many, especially in the internal EU market, are now watching German UGS facilities. They are currently less than 42 percent full. Such a low filling level has never been seen before.
– But this is just an average! You can confirm that the level of reserves in Gazprom’s large gas storage facilities in Germany has dropped to about 17 percent, while the rest nGerman UGSFs are still approximately 50 percent full?
Sebastian Bleshke, Executive Director of the German UGS Association INES
– Gazprom Group operates gas storage facilities in Germany through two subsidiaries: Astora and Erdgasspeicher Peissen, the latter being a joint venture with VNG. The average filling level of the three UGSFs of these two operators is really that low.
– As an executive director INES, you are obliged to show loyalty to all members of the association, which includes and Astora, and Natural gas storage Peissen, to some, perhaps better known as UGS Catherine. So the question is not about reasons, but about the possible consequences of such a situation: will the available volumes be enough until the end of the heating season?
– Here one should certainly take into account the overall picture, because thanks to the various gas pipelines built in recent years, the EU member states are very well connected with each other. This gas transportation infrastructure ensures the interaction of individual markets.
So, according to the examination of the Ministry of Economics of Germany, conducted in 2015, Germany by February 1, in case of 7-day and 30-day cold weather, a filling level of 40 and 50 percent, respectively, is required. This examination also considered the option of a political conflict and the termination of any gas supplies from Russia for a whole month. In this case, we would need a fill level of 60 percent. It is quite obvious that if we already have less than 42 percent and the gas intake rates of the last few days continue, we will not reach the targets.
The largest German UGS facility in the EU, Rehden, with a capacity of 3.9 billion cubic meters of gas, has been owned by Gazprom since 2014
Let’s take political conflicts out of the equation. But the frosts that continue for 30 days in a row in Germany in February are still unlikely, especially in the context of global warming.
– I do not undertake to assess the likelihood of such risky scenarios, and I am even more of an inappropriate interlocutor on the topic of political conflicts. But the longer the winter lasts, the higher the likelihood of more favorable temperatures. Anyway, at the moment the weather is quite mild. Yet some uncertainty remains.
– And in the winter months there is only gas extraction, or are there days when relatively high temperatures allow replenishing stocks in gas storage facilities?
– Just before the New Year, between December 29 and January 3 or 4, we observed the injection of gas into UGSFs, and these days their occupancy increased somewhat.
– But isn’t public attention fixated too much on the level of UGS reserves? And does this not lead to an exaggeration of the problem of supplying the European Union with gas? Maybe, do energy companies now simply prefer to use their reserves intensively so as not to buy gas that is currently very expensive on the market, and are waiting for prices to drop in the coming weeks, including due to the arrival of significant volumes of liquefied gas? After all, judging by the reports, a fairly large number of LNG tankers have moved towards Europe.
– Naturally, one cannot look at gas storages alone, because not only they provide gas supply, it is connected with various factors. So, we are now seeing an unusually high capacity utilization of LNG receiving terminals. However, recent weeks have again shown that UGS facilities play a central role in gas supply just in winter. So they were and still are an important factor.
– But even if the weather in February and March turns out to be mild: the level of stocks in German gas storage facilities by the end of this winter will in any case be very low. Is there enough time to technically pump enough gas into UGS facilities by the next heating season??
– Yes, this confirms the experience of last year. Back in May, which is quite late, our filling level was only 26 percent, compared to previous years, this was already very low. Nevertheless, it was technically possible to bring stocks up to more than 90 percent by the end of September. Therefore, I firmly believe that we will be able to fill the gas storage well by next winter, even if the reserves are very low by the end of this winter.
– Let’s finally return to the current situation: what are the chances of Germany to live until the coming spring without interruptions in gas supply?
– I would sum it up like this: long-term contracts are being fulfilled, we hear it from everywhere, the level of reserves in UGSF is at a historically low level, which creates some uncertainty, but the weather is quite mild, which reduces the tension in the market. Therefore, I am cautiously optimistic, although it is too early to calm down.
See also:
