Moldova cuts gas supplies to more than 2,000 users over unpaid bills

Moldova's Moldovagaz said Aug. 17 it had ordered the suspension of gas deliveries to more than 2,000 non-household gas users over unpaid debts for previous supplies.

In a statement, Moldovagaz said the unpaid bills threatened the company's ability to pay Russia's Gazprom for its gas imports.

The deadline for Moldovan non-household customers to pay for July deliveries was Aug. 15, with 2,002 users owing a total of Leu 75.5 million ($4 million).

Moldovagaz said this made it impossible for it to meet its payment obligation to Gazprom, which was dependent on the "timely payment by end-users of gas consumed."

"In order to ensure the continuous operation of the country's gas system and to not allow an accumulation of the debt, Moldovagaz orders the disconnection of the gas installations of the debtor consumers," it said.

It added that gas supply would be resumed after full payment and a reconnection charge.

Moldovagaz had already decided in early August to cut supply to 708 household customers that had not paid their bills that totaled Leu 4.1 million.

Gazprom supplies

Moldovagaz struggled in early 2022 to meet its payment commitments to Gazprom after prices under its long-term contract rose sharply.

The price for April rose to $1,193/1,000 cu m after sharp increases in European gas hub prices in March, and has risen again further in August to $1,458/1,000 cu m after a new spike in wholesale prices.

The price is set to increase further in September to $1,692/1,000 cu m as European hub prices hit new record highs.

The Dutch TTF month-ahead price reached a new all-time high of Eur222.20/MWh on Aug. 16, according to Platts price assessments from S&P Global Commodity Insights.

Moldovagaz is hoping it can secure an extension of the Gazprom payment deadline of Aug. 20, though the Russian company has rejected such requests in the past.

The Russian contract price is formulated according to a mixture of prices on the Dutch TTF hub and fuel oil prices.

In December last year, it was just $450/1,000 cu m, but has risen significantly through 2022.

Last October, Gazprom and Moldovagaz extended their long-term gas supply agreement for a further five years until September 2026.

Ahead of the new long-term deal, Moldova experienced an acute gas shortage after a last-minute, one-month extension of the agreement with Gazprom at the end of September meant Russian supply for October had been lower than hoped.

It was forced to hold a number of daily tenders for the supply of gas from European traders to meet demand, having declared a state of emergency.

Among the suppliers to Moldova in that time were Ukraine's Naftogaz Ukrayiny, Poland's PGNiG as well as traders DXT Commodities and Vitol.