Estonia will have about 650 gigawatt-hours (GWh) of gas as strategic gas reserves in the lead-up to winter, a third less than the government's spring target, as the stockpiling agency has ran out of government funds.
The Estonian Stockpiling Agency (Eesti Varude Keskus or ESPA) said on Tuesday that the fourth gas tender will be the last one for the time being, with €33 million available to purchase between 200 and 250 GWh of gas.
In the spring, the government set a goal of one terawatt-hour of emergency gas supply for the stockpiling center and allocated €170 million to achieve the goal.
The winter gas reserve will total to 650 GWh if the storage facility purchases another 200 GWh of gas in the last procurement.
Priit Ploompuu, a member of the ESPA's management board, said that the amount of gas that can be purchased for €33 million in this last tender depends on the exchange rate and is now estimated to be between 200 and 250 GWh.
On Wednesday morning the price of gas on the market was €157 per megawatt-hour, thus €33 million could buy 210 GWh of gas.
The preceding three contracts that have already secured a total of 450 GWh of gas, cost the storage facility €99 million, or €220 per MWh on average. The third procurement was the most expensive, costing €63 million for 250 GWh at €252 per MWh.
The stockpiling agency has spent a total of €132 million on gas, which indicates that €38 million should still be available.
Ploompuu said, however, that the storage facility does not have these funds, as the government has set aside €38 million for the future acquisition of an LNG terminal dock.
The state has guaranteed these funds to Alexela and Infortar, the private companies that built the terminal.
The government will decide on Thursday whether to spend additional €33 million for the fourth procurement. What happens next is unknown at the moment.
The entire 650 GWh of Estonia's national gas reserve will be stored in Latvia at the Inukalns underground gas storage facility. Ploompuu said that the remaining gas from the fourth procurement will be also delivered there.
Editor: Kristina Kersa