Russia stop gas flow to Finland over a dispute about payments

Saturday, May 21, 2022
author picture Daniel Marino
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Original content created by staff

Finland Blocks Russian Gas Deliveries in Finnish Rupees

The Finnish government has rejected Russian demands to pay for natural-gas deliveries in the national currency‚ blocking the flow of natural gas to the country. The country rebuffed the demand and suspended all gas deliveries until the dispute can be resolved. Moreover‚ Finland's state-owned energy company‚ Gasum‚ has refused to accept payments in roubles. The deadline for payment for the previous deliveries passed on the 20th‚ and Gazprom completely stopped the delivery.

By Terje Solsvik OSLO (Reuters) – Russia's Gazprom stopped gas exports Saturday to Finland in the latest escalation in an energy payment dispute with Western countries. Gazprom Export demanded that European nations pay in Russian roubles for Russian gas supplies because of the sanctions against Moscow's invasion of Ukraine. But Finland refused. Gazprom's move comes as Finland applies to NATO for military support. This decision was prompted by Russia's invasion of Ukraine. Gas imports via Imatra have been stopped by Gasgrid Finland‚ a Finnish gas system operator. Imatra is where Russian gas enters Finland. Gasum‚ a Finnish state-owned wholesaler of gas‚ said Friday that Gazprom warned flows would stop at 0400 GMT Saturday morning. Gazprom and Gasum also confirmed that the flow had stopped on Saturday. Gasums Supply Contract has been terminated‚ resulting in the suspension of natural gas supply to Finland. Gasum will start supplying natural gas from other sources to customers starting today through the Balticconnector pipeline. Balticconnector connects Finland and Estonia to the gas grid. Gazprom Export announced Friday that flows will be reduced because Gasum has not been compliant with new Russian rules that require settlement in rubles. Although Finland uses the majority of Russian gas‚ only 5% percent of Finland's annual energy use comes from Russia. The majority of European supply contracts are in dollars or euros. Moscow cut gas supplies to Poland and Bulgaria last month when they refused to accept new terms for payment. The Finnish government‚ Gasum and the individual Finnish gas-consuming companies have all stated that they are prepared to shut down Russian flow and will be able to manage the situation without them. Gasgrid stated Saturday that the Finnish gas system was in equilibrium‚ both commercially and physically. Finland announced Friday that it has agreed to charter an Excelerate Energy storage and regasification ship to replace Russian supplies. The vessel will be available for charter in the fourth quarter of this year. Supercooled natural gas (LNG) is released from the vessel and converted back to regular gas. Gwladys Fouch edited; David Evans edited