Conexus: we need new ways of using Inčukalns gas storage facility
Following the liberalization of the country’s gas market, it is necessary to search for new ways of using Inčukalns gas storage facility, says Conexus Baltic Grid chairperson Zane Kotāne.
«Inčukalns is at a market crossroads, when it is necessary to search for new ways of using the storage facility. Last year, we started working on this. Danish company Rambol performed a study financed by the European Union on the way the role of Inčukalns storage facility could change after the liberalization of the market and which products or services the company should focus on to develop,» said Kotāne. Speaking of the main conclusions of the study, she said that while in the past Inčukalns worked as a seasonal storage facility, two more possible goals for the use of the facility have been proposed to gradually replace its role as a seasonal facility. One of them is the so-called short-term use variant and the other is – ensuring safety of supplies.
«There is often a dialogue on short-term use, implying use of the storage facility for two days. However, short term use in reality means a slightly different thing. It is about using gas market price fluctuations, and the market is very volatile. Natural gas exchange price changes under influence from many different factors. The storage facility serves as a way to manage and fixate prices,» explains Conexus manager.
She also adds that the storage facility can serve as so-called parking for liquefied natural gas. «This kind of movement is very specific. When a ship docks in Klaipeda, it needs to be emptied a quickly as possible. This means technical processes and the storage facility’s products have to be sorted to ensure quick transfer of gas from the ship to the facility,» says Kotāne. Another direction for the facility to work towards is satisfaction of peak demand. «Gas consumption tends to vary. For example, consumption in Latvia can reach one million m3 a day during the summer season. During winter, however, consumption can reach up to 12 million m3 a day. It is not simple to secure peak consumption. It is one direction in which the facility could have a larger role. Historically Latvijas Gāze planned its stores by predicting influx. Now, however, traders have to plan everything themselves. The storage facility is a tool to be used in planning,» says Conexus chairperson. Although until now investments in the storage facility have been sufficient and the facility itself has been well-maintained, new capital investments are needed to ensure new activities. «We have to consider opportunities at the same natural gas volume present in the facility and secure a larger volume to the transmission system if it is needed. We are working on collection threshold for renovations in a way that will not only replace old equipment but also help change the technological process, separating each of the well to make them individually managed. Currently all wells are managed together. Once division is performed, the situation will change. Also in relation to the reconstruction of wells is security, change of supply times. Another thing to keep in mind is choosing technologies that allow wells to function more efficiently. This is what the market demands – quick and flexible provision of services to traders,» adds Kotāne.