Germany considers creating national gas reserve
Germany is considering setting up a natural gas reserve to reduce its dependency on imports from Russia, a spokeswoman for the Economy Ministry said on Friday.
Germany relies on Russia for about 44% of its gas imports, according to government information, and in recent years Moscow has cut off energy supplies to some of its neighbors on a number of occasions. The conflict between Russia and Georgia has heightened awareness in Germany about its dependence on Russian gas. There was a risk in being too dependent on one region as a source for gas, the Economy Ministry spokeswoman told a regular government news conference.
“For that reason, the Economy Ministry is consulting with companies, and on a European and international level, to see if we need something for crisis management, a storage system, as we have for oil ... in case it becomes necessary,” she said. “We have to see if the state should get involved,” she added, noting that the talks were at an early stage. She declined to give further details.
A spokesman for German utility E.ON’s Ruhrgas unit criticized the idea of a reserve, arguing that the market structure is very different to that of oil. Germany has long-term gas contracts with Russia which run until 2036 and with Norway until 2009, whereas the spot market determines oil prices. The establishment of a gas reserve could be viewed by producers as a signal that their position as suppliers is not as reliable as previously thought, the Ruhrgas spokesman said. “This could lead to more expensive natural gas imports,” said the spokesman.
Storing gas for an additional 90 days of supplies would cost some €2 billion ($3 billion) a year, the foreign trade association for mineral oil and energy estimated, according to an article in Germany’s Frankfurter Allgemeine Zeitung. (Reuters)
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