Jul 11 2022
Canada is to allow gas turbines used to flow gas through the Nord Stream pipeline from Russia to Germany that are repaired on Canadian territory to be returned to Germany under a sanctions waiver, a senior Canadian government official said July 9.
In a statement, Canada's natural resources minister Jonathan Wilkinson said Germany's economy would suffer "significant" hardship in the event of a shortage of gas.
Russia's Gazprom on June 16 cut gas supplies via the Nord Stream pipeline to Germany to just 40% of capacity, citing maintenance issues with gas turbines at the key Portovaya compressor station.
One turbine that had been sent by Germany's Siemens to a factory in Montreal, Canada, for maintenance had been stuck in the country after Ottawa imposed sanctions against Moscow that meant the turbine could not be returned.
Another turbine was shut down after Gazprom said its window for undergoing required maintenance work had passed.
"Canada will grant a time-limited and revocable permit for Siemens Canada to allow the return of repaired Nord Stream turbines to Germany," Wilkinson said in the statement posted to his Twitter account.
This, he said, would support Europe's ability to access "reliable and affordable energy" as it continues to transition away from Russian oil and gas.
"Absent a necessary supply of gas, the German economy will suffer very significant hardship," he said.
European gas prices remain at sustained highs following the Nord Stream cuts and further uncertainty over future Russian gas flows.
The benchmark Dutch TTF month-ahead price is now back close to the all-time high of Eur212.15/MWh reached in early March, according to Platts price assessments from S&P Global Commodity Insights.
The TTF month-ahead price was last assessed at Eur168.98/MWh on July 8, up 105% since the start of June and 420% higher year on year.
The market remains concerned about the fate of Nord Stream flows. Its annual maintenance shutdown began July 11 and is scheduled to last until July 21, and there are fears over whether the pipeline will restart at all following the work.
With Nord Stream flows cut to zero, Russian pipeline gas is currently only reaching Europe via Sudhza in Ukraine and via the TurkStream pipeline to Southeast Europe and Turkey.
Flows at the Sudzha point -- the only route for Russian gas deliveries via Ukraine at present -- were nominated at at 41 million cu m/d for July 11, according to data from Ukrainian grid operator GTSOU, in line with recent daily flows via Sudzha.
The head of Germany's Uniper on July 8 said he hoped it was not too late for Gazprom to remedy the situation regarding Nord Stream flows.
"I hope Nord Stream will come back at full capacity and that the technical problems can be solved," Uniper CEO Klaus-Dieter Maubach said at a press conference.
"I haven't given up hope yet that things will go back to normal," he said, adding that the level of Nord Stream flow post-maintenance would be "decisive" for Uniper for the coming months.