Natural Gas Storage In Russia At 88% Of Target Ahead Of Winter

Gazprom has filled 88% of the targeted winter volumes of natural gas in Russia’s underground storage facilities, the Russian gas giant’s CEO Alexey Miller said on Thursday.

“We are pumping gas into Russian underground storage facilities right on schedule. This should also be mentioned. Storage is currently 88% of target,” Miller was quoted as saying by Russian news agency Interfax.

Miller expressed confidence that Gazprom would meet by the start of the winter season all the targets for injecting gas into Russian storage facilities.

“Active gas injection will reach record volumes by this winter, and the potential daily productivity will reach record volumes by the beginning of the offtake period,” according to Miller.

While gas injection in Russian storage is set to hit record-high volumes, Gazprom’s exports to Europe have slumped and dragged the gas giant’s profits down this year compared to 2022.

Gazprom has reported a massive drop in its first-half net profit as deliveries to Europe have slumped compared to 2022 when Russia was still supplying pipeline gas to its European customers for most of the first half of last year.

Gazprom’s net profit plunged by 8.5 times to stand at just $3.1 billion (296 billion Russian rubles) for the first half of 2023, down from $26 billion (2.5 trillion rubles) for the same period of 2022.

The collapse in Gazprom’s net profit was also due to the weak ruble, which fell by 24% against the U.S. dollar in the first six months of 2023, Famil Sadygov, deputy CEO at Gazprom, said.

“The decline in exports to Europe was partially offset by an increase in supplies to China, which will continue to grow within contractual obligations, as well as by the efficient operation of the oil business,” Sadygov also noted.

The major drop in Gazprom’s gas deliveries to key customers was due to the halt of Russian pipeline gas exports to nearly all European countries after the Russian invasion of Ukraine.

By Charles Kennedy for Oilprice.com

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