Moldova Considering Gas Options in Case Russia Cuts Supply through Ukraine

Moldova is wary of possible gas supply disruptions if Russia’s Gazprom doesn’t reach an agreement with Ukraine until December 31 and is looking for a solution, Kommersant wrote on Tuesday. 

One answer for Chisinau may be pumping gas through Gazprom new TurkStream pipeline, but then it would be necessary to agree with Bulgaria, Romania, and also Ukraine, as well as to find sources of financing. 

Experts told the business newspaper that given the political climate, Gazprom will make every effort to resolve the issue of supplies to Moldova.

Chisinau has already started negotiations with its sole gas supplier and the owner of half of state energy company Moldovagaz, Gazprom, on gas supplies through the TurkStream, Kommersant wrote. 

At the moment, Moldova receives about 3 billion cubic meters of gas from Russia along the Trans-Balkan corridor, which passes through Ukraine. However, this transit may end on January 1, 2020, if Moscow and Kiev do not agree on new conditions, and so far, there has been no progress on that score.

Moldova is currently negotiating with the Russian gas giant to conclude a new contract or extend the current one. The price of gas for the country in Q1 2019 was around $240 per 1,000 cubic meters. That said, Chisinau expects to get a 25-30% discount.

A source close to the talks, however, told the newspaper he doubts that Russia will accept such a large discount, but Gazprom “will continue to supply in one way or another, because this is largely a political issue.” A source on the market told the newspaper that they believe that the monopoly may even be forced to bankroll the delivery infrastructure to Moldova via TurkStream.

Vyacheslav Mishchenko, Executive Director of the Skolkovo Energy Center, told Kommersant he believes that given Moldova’s political instability, it is important for Moscow to keep Chisinau “inside the orbit of Russian interests.”

“There is no obvious route to bypass Ukraine, and problems with gas supplies will cause serious destabilization in the region,” the expert warned. At the same time, even a substantial discount for Moldova will not be a problem for Gazprom, given the small volume of supplies, he added.