Today’s Wall Street Journal reports:
Russia’s state natural gas monopoly OAO Gazprom warned Saturday that a pricing dispute with Ukraine could disrupt gas supplies to Europe. Ukraine could use its pipeline to divert Russian natural gas intended for European customers even if it fails to pay its multibillion debt to Gazprom by Jan. 1, said company spokesman Sergei Kupriyanov. If that happened, the company was “not sure we could fulfill our transit obligation” of Europe-bound gas supplies, he said.
The UK is dependant on gas from Russia as supplies from the North Sea are insufficient to meet demand. The UK has insufficient facilities for the storage of gas. Further, the UK is reluctant to invest in additional gas storage facilities. This was discussed at length at a meeting of The Scottish Oil Club in November 2005 by Adrian Fernardo of Star Energy who at that time was seeking to build additional gas storage. His presentation is published here.
We need to start building additional storage facilities and we need to reduce our reliance on gas from Russia.