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21 May, 2022 05:18

Russia halts gas supplies to Finland

The move comes after Finland's state energy company failed to comply with Moscow’s ruble payment demand
Russia halts gas supplies to Finland

Russia has halted natural gas deliveries to Finland after state energy wholesaler Gasum failed to make a required payment in rubles, the Finnish gas system operator Gasgrid Finland said on Saturday. 

Gas imports through Imatra entry point have been stopped,” the statement read.

Russia’s Gazprom Export has confirmed a complete halt in gas deliveries to Finland.

Gazprom has completely stopped gas supplies to Gasum (Finland) due to non-payment in rubles. As of the end of the business day on May 20, Gazprom Export has not received payment for gas supplies in April from Gasum (Finland)” in accordance with the new ruble-based payment mechanism, the company said in a statement.

Gasum also confirmed on Saturday that the deliveries had stopped.

Earlier this week, Gasum announced that it would not comply with Russia’s new ruble-based gas payment scheme.

Finland imports the vast majority of its natural gas from Russia, but the fuel only accounts for about 5% of the country’s energy use.

Nearly 30% of primary energy in Finland comes from wood-based fuels, while 22.5% is from oil, and 19% from nuclear energy, according to media reports, citing official figures.

In 2020, Russia supplied around 1.61 billion cubic meters of natural gas to Finland, and last year the figure stood at 1.8 billion cubic meters. Also, Finland has two liquefied natural gas terminals in Pori and Tornio, with total capacity of 0.65 billion cubic meters per year.

In order to completely replace Russian gas supplies, Finland will have to fully use its existing energy infrastructure, analysts say, as the Nordic nation does not have its own underground gas storage capacity.

State company Gasum says it's prepared for a Russian supply shutdown. Finland hopes to receive gas from Estonia via the Balticconnector gas pipeline during the summer, although Tallinn also rejected Russia’s new payment mechanism last month, and capacity limitations on the pipeline may complicate the task.

Media reports also say that both Estonia and Finland intend to rent a floating terminal to receive liquefied natural gas (LNG) by next autumn.

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