President Volodymyr Zelenskiy has recently suggested extending the ban on the export of Ukrainian natural gas for the entire year of 2024, as stated in a presidential decree released on Tuesday. This proposed extension follows the initial imposition of the export ban in response to Russia’s invasion of Ukraine in February 2022, which was subsequently prolonged to encompass the entirety of 2023.
The decree, addressed to the Cabinet of Ministers of Ukraine, specifically calls for the establishment of a zero export quota for natural gas of Ukrainian origin in 2024. Additionally, it emphasizes the need for the government to bolster the capacity of Ukraine’s gas transmission system to facilitate the import and storage of natural gas in underground facilities.
Prime Minister Denys Shmyhal had recently indicated that Ukraine was prepared to allocate up to half of its 30 billion cubic meters (bcm) underground gas storage capacity to foreign energy traders. Notably, Ukraine’s major oil and gas company, Naftogaz, had earlier expressed its willingness to allow foreign clients to utilize over 10 bcm of storage, primarily situated in the western regions of the country, distant from the conflict zones.
Prior to the conflict, Ukraine used to produce approximately 20 bcm of gas, a quarter of which was generated by private entities that exported a portion of the resource. However, exports were suspended in the wake of the conflict to ensure the fulfillment of domestic energy demands.
Oleksiy Chernyshov, the chief of the leading state-owned gas producer Naftogaz, had previously announced plans to elevate gas production to 19.1 bcm in 2023, with the ambition of navigating through the winter season without the need for gas imports. He also projected a decline in Ukraine’s natural gas consumption to below 20 bcm this year, compared to approximately 27 bcm in 2021, with the country’s gas reserves exceeding 16 bcm.
