Finnish Gasum has stopped purchasing LNG from the Russian Federation since July 26, declaring force majeure on its contract with NOVATEK's Cryogaz-Vysotsk. It is a Russian medium-tonnage liquefied natural gas plant and an offshore LNG terminal. EU sanctions in June banned LNG imports from Russia through off-grid terminals, which also affected shipments to Sweden. In June and July, Helsinki and Stockholm continued to purchase Russian LNG, while Finland increased imports from the United States and Norway. But in Sweden during this period, imports fell by half compared to last year, and the country, according to analysts, will find it more difficult to replace Russian LNG. At that time, NOVATEK began shipping shipments to Spain, where LNG from Cryogaz-Vysotsk had not previously been supplied. Arctic Century wrote more about Russian LNG in this article.
Finnish Gasum, as expected, has stopped purchases of Russian LNG from NOVATEK and Gazprombank's Cryogas-Vysotsk plant since July 26. The 14th package of EU sanctions prohibits the import of Russian LNG through EU terminals that are not connected to the gas transmission system. This measure is directly related to the long-term contract concluded by Finnish Gasum with Cryogaz-Vysotsk. A transitional period of one month was given for the termination of bilateral relations from the date of publication of the sanctions — until July 26.
On July 26, Gasum confirmed that it complies with all sanctions imposed by the EU, therefore it stopped all purchases of Russian LNG.
Finland continued to buy LNG from Russia in the same volumes in June and July, Norway remains the dominant supplier for the country. In June, LNG imports into the country reached a historic high of 0.229 million tons, primarily due to the purchase of large shipments of LNG from the United States in the amount of 0.135 million tons. As of July 29, imports to Finland halved compared to June — to 0.093 million tons, 0.019 million tons came from Russia, 0.069 million tons from Norway.
At the same time, LNG imports to Sweden in June and July decreased by at least half year-on-year, to 0.011 million tons. In June, Stockholm did not buy a single batch of LNG in Russia, in July — only 4 thousand tons. The country also buys LNG from Norway, the Netherlands and Belgium.
Unlike Finland, which can accept conventional tankers, for the Swedes, the issue of replacing Russian volumes may be much more problematic, since the entire local market consists of low-tonnage supplies. Small LNG shipments from Stavanger, Norway, continue, however, Sweden's imports are likely to be generally lower in the near future.
In this situation, the main question is whether Cryogas—Vysotsk will be able to redistribute the lost volumes of Finland and Sweden in a short time, which accounted for up to a third of the design capacity of the plant. Up to half of the exports from the site are now going to Belgium, but so far supplies here have not increased. However, in June and July, NOVATEK began shipping LNG shipments comparable to Finland and Sweden to Spain for the first time since the launch of the site.
The capacity of Cryogas-Vysotsk is 660 thousand tons of LNG per year. The scope of the contract with Gasum was not disclosed, but it was supposed to be valid for many more years. Historically, Gasum had long-term contracts for supplies from the Russian Federation through a pipe with Gazprom and in the form of LNG with Cryogaz-Vysotsky. In May 2022, Gazprom stopped deliveries to Finland via the pipeline, as the country refused to switch to payment for supplies in rubles. Supplies in the form of LNG continued, as payments could be made in euros.
Source: Arctic Century
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