Ukraine imports Azerbaijani gas for first time as storage runs low
Ukraine's state energy giant Naftogaz has signed its first agreement to import natural gas from Azerbaijan, the company said in a press release on July 28.
The deal comes as gas storage reserves have fallen to their lowest level in at least 11 years, driven by Russian attacks on Ukraine's energy grid. The strikes have devastated the country's domestic production, with Naftogaz losing half of its gas production capacity.
With winter approaching, the country has accelerated gas imports to ensure sufficient supplies before the heating season begins.
The first agreement to supply Azerbaijani gas to Ukraine was signed with the Ukrainian subsidiary of Azerbaijan's state oil company Socar, according to the press release.
The inaugural test shipment is being delivered through the Trans-Balkan route along the Bulgaria-Romania-Ukraine corridor, opening a new supply pathway for the country.
Serhii Koretskyi, CEO of Naftogaz, called the deal another example of diversifying supply sources for gas.
"This is a small volume but strategically important step that paves the way for long-term cooperation," he said.
Energy Minister Svitlana Hrynchuk wrote on her Facebook page that gas imports through the Trans-Balkan pipeline will provide access to Greek and Turkish liquified natural gas (LNG) terminals, as well as Romanian and potentially Bulgarian offshore production.
Beyond the Azerbaijan deal, Ukraine has secured multiple supply agreements for the upcoming winter. Naftogaz has signed four contracts with Poland's Orlen for the delivery of 440 million cubic meters (mcm) of U.S. LNG, with the latest agreement announced July 2 covering an additional 140 mcm.
According to Bloomberg estimates, Ukraine may import a record 5 billion cubic meters (bcm) of gas from Europe in 2025.
