Decisive winter ahead for the Ukrainian energy sector

Naftogaz CEO
Oleksiy Chernyshov
Ukraine is going through one of the most difficult periods in the country's 31 years of independence.

Since the Russian invasion started, the energy infrastructure of our country has been subjected to large-scale destruction, both in the conflict zone and far from the front lines of the fighting. 

Naftogaz gas production infrastructure has also suffered extensive damage. Since the beginning of the Russian invasion, more than 350 Naftogaz Group oil and gas infrastructure facilities have suffered. In addition, more than 450km of gas pipelines have experienced damage.

While we cannot be sure of the enemy's plans, we are preparing for the worst and working to scenarios that assume continued shelling and airstrikes. With this in mind, we are taking measures to protect our personnel and, as much as possible, the facilities themselves. 

The sheer cynicism of Russia's targeted airstrikes on Ukraine's civilian infrastructure has not gone unnoticed by international audiences. In response to Moscow's terror-bombing campaign, the European Parliament recently recognized Russia as a state sponsor of terrorism. The whole world sees that Russia is unable to defeat Ukraine on the battlefield and is instead attempting to target civilians and provoke a new wave of Ukrainian refugees. 

Faced with these terror tactics, Ukraine is forced to reorganize its energy infrastructure to make sure it is able to function in wartime conditions. In this battle, the coming winter months will be decisive. Given the severity of the Ukrainian winter and the scale of Russia's destructive campaign, this is a challenge no other country has ever faced. 

Due to continued power cuts, Ukraine's energy balance will change. Where possible, natural gas and other hydrocarbons will be used instead of electricity. The role of Naftogaz in this process will be absolutely crucial. More than ever, Naftogaz will perform its duties as the guarantor of Ukraine's energy independence and energy security. The company has the necessary resources and experience for this task.

Before the beginning of the heating season, 14.5 billion cubic meters of gas had been accumulated in Ukraine's underground storage facilities, which would normally be sufficient for the winter period. However, intensive Russian missile attacks on energy infrastructure provoked additional gas consumption by Ukraine's power-generating enterprises.

In the current situation, we need to be ready to source additional volumes of natural gas and oil products in a short time as well as accumulating additional reserve volumes. For this purpose, we are already working intensively in cooperation with international partners from the United States, Canada, and Europe that continue to support us in the fight against Russian aggression. 

We recently discussed the needs that arose in connection with the full-scale Russian invasion during a meeting with ambassadors of the G7 countries and the Head of the EU Delegation to Ukraine. We agreed that we will not only work together to eliminate the consequences of Russia's attacks, but also to develop cooperation in the production of hydrocarbons in Ukraine. During this meeting, I also gained the support of the ambassadors for the priorities I have identified and the first steps that I have taken as new Naftogaz CEO.

I am convinced that effective interaction with international partners is impossible without restoring confidence in Naftogaz. With this in mind, transparency, stability, and predictability are the key components that we must provide.

Despite the war, we must look to the future and create preconditions for efficient transformation of the Ukrainian energy market. This includes increasing domestic gas and oil production.

Naftogaz is the largest energy company in Ukraine responsible for the production, storage, and supply of natural gas and oil. Ukrgasvydobuvannya, Ukrtransgaz, Ukrtransnafta, Ukrnafta and other companies of the Group provide a full cycle from production to delivery to consumer services.

Our main asset is our people. Every employee is working today to bring Ukraine's victory closer. Repairing damage caused by enemy attacks and reconditioning critical equipment are all part of their heroic daily work, for which I am infinitely grateful.

I am confident that together we will withstand, win and rebuild!