Boom in European gas projects after Russia’s demand for payment in rubles

The Tyra Field in Denmark is not expected to reopen until after rebuilding is finished in 2023. In many other European countries, new alternatives to Russian gas are being sought. Illustration: Mærsk

The plan to make Europe independent of Russian gas by 2030 has put pressure on EU countries to find alternatives to the 155 billion cubic meters of Russian gas that the EU normally imports.

The pressure to find quick solutions has risen since Russian gas supplier Gazprom began demanding payment in rubles.

The Dutch authorities have just approved a German-Dutch project for the extraction of natural gas from the North Sea, which is expected to be able to supply natural gas from 2024.

The announcement came after Gazprom on Tuesday cut off gas supply to the Netherlands because the partly state-owned Dutch company GasTerra in April had refused to pay in rubles, DW News writes. This means that the Netherlands is now short of two billion cubic meters of gas until October. However, GasTerra had taken precautions and purchased gas elsewhere.

The Dutch authorities estimate that the new gas sources can supply between two and four billion cubic meters of gas per year. The project has been delayed due to opposition in Germany, partly because the area where drilling is to take place is a wetland with great biodiversity. According to the Dutch authorities, the authorities in Lower Saxony have changed their position on the project after the war in Ukraine and are expected to approve the project soon.

Norway is considered one of the least politically problematic countries to get gas from, and Norwegians are taking advantage of the opportunity to add extra income to the treasury from the sale of gas. But the Norwegian gas sources are already running at maximum capacity, so the increased sales have given rise to a political discussion about whether to open completely new gas wells, Politico writes.

However, Norway will find it difficult to increase production over the next few years. According to Lars Haltbrekken, spokesman on climate and energy from the Socialist Left Party, it will take 15 to 20 years before the new sources are able to supply natural gas. By that time, many countries will have switched to renewable energy, so it strategically and environmentally does not make sense to open new wells, he says.

The disagreement with the Socialist Left Party may delay, and perhaps even put a stop to the Norwegian government’s plans to create new gas wells, e.g. in the Barents Sea.

In Denmark, Ørsted announced on Monday that they will not pay for Russian gas in rubles. And subsequently, Gazprom Export announced that it will stop supplying gas to Ørsted.

“As there is no direct gas pipeline from Russia to Denmark, Russia will not be able to close off the direct supply of gas to Denmark, and gas will thus still be able to come to Denmark. However, this means that the gas must to a greater extent be purchased on the European gas market. We expect this to be possible,” Ørsted said on Monday.

“In Ørsted, we have prepared for this scenario to minimize the risk that Ørsted’s gas customers, who are primarily larger business companies in Denmark and Sweden, will run out of gas. Ørsted has storage capacity in Denmark and Germany, among other countries, and we are in the process of filling these stocks, so that we can secure gas for our customers and contribute to the market’s security of supply.”

The Danish natural gas field Tyra is closed due to redevelopment, but it is scheduled to reopen in 2023.

In addition, the Danish state’s oil and gas company Nordsøfonden announced in its annual report for 2021 that it would advance two new oil wells in the western part of the Solsort field in the North Sea.

In the past, Russia has cut off gas supply to Bulgaria and Poland.