Bloomberg News

Slovakia Seeks Emergency Gas to Counter Shortage (Update2)

January 09, 2009

Slovakia is seeking emergency imports of as much as 10 million cubic meters of natural gas a day as supplies of the commodity from Russia remain halted for a third day, Economy Minister Lubomir Jahnatek said.

Slovensky Plynarensky Priemysel AS, the country’s dominant gas company, is negotiating to import gas from sources other than Russia’s OAO Gazprom, including E.ON AG, GDF Suez and OMV AG (OMV), Chairman Bernd Wagner said at a press conference in Bratislava, Slovakia after meeting with government officials to discuss the shortage.

The utility “is working heavily to get emergency supplies to Slovakia and some small amounts are already available,” Wagner said. “Technically, this is quite a complex task we are facing.”

Slovakia relies completely on flows of the commodity via Ukraine, whose dispute with Russia over pricing and transit fees makes the eastern European country one of the hardest hit European Union members. Slovensky is continuing with restrictions of gas usage for industrial clients as supplies of stored gas have been falling.

Slovensky can’t guarantee supplies of gas for all Slovak regions for longer than nine days, Wagner said. The government is urging companies to cut consumption more and will start penalizing manufacturers which don’t adhere to the curbs, Jahnatek said.

About 1,000 companies have been affected by the restrictions, including carmaker PSA Peugeot Citroen and Kia Motors Corp., which halted production yesterday because of the gas shortage.

RWE Transgas AS, the Czech dominant gas trading company, said it will give up gas from its Slovak storage facility for Slovakia’s current needs. The utility will release the first 2 million cubic meters of gas as early as tomorrow morning, spokesman Martin Chalupsky said in an e-mailed statement from Prague.

The Czech Republic, Slovakia’s former federal partner, can cover about 15 percent of Slovakia’s gas consumption, or 4 million cubic meters of the commodity, Czech Industry Minister Martin Riman said earlier today.

To contact the reporters on this story: Radoslav Tomek in Bratislava at rtomek@bloomberg.net; Andrea Dudikova in Prague at adudikova@bloomberg.net.

To contact the editor responsible for this story: Chris Kirkham at ckirkham@bloomberg.net.


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