Slovakia faces steep drop in income from Russian natural gas transit amid Ukraine conflict fallout

(MENAFN) Slovakia has experienced a significant decline in income from the transit of Russian natural gas, losing over two-thirds of its previous earnings, as reported in the financial results released by Eustream, the country's gas transmission network operator, this month.

The data reveals that in the 12 months leading up to July 2023, Slovakia transported 16.97 billion cubic meters (bcm) of Russian gas, generating €226.5 million (USD242.8 million) in revenue from the transit. Prior to the Ukraine conflict and subsequent EU sanctions against Russia, the country used to transport an average of around 60 bcm of Russian gas annually. For instance, in the accounting year from August 2019 to July 2020, Eustream transported just under 61 bcm, yielding revenue of €748.04 million.

Experts attribute the sharp decline in Russian gas transit volumes to the Ukraine conflict. Slovakia receives gas through the transit line via Ukraine, where flows diminished after Kiev closed its key gas pumping station, Sokhranovka, in May 2022. While Russian energy major Gazprom still supplies gas for transit through the remaining station, Sudzha, the capacity only allows for flows of approximately 40 million cubic meters per day.

With transit flows now less than one-third of the pre-conflict average and revenues decreasing more than threefold, analysts in Slovakia are expressing concerns about the country's budget, which is rapidly losing a significant income source. According to local reports, the government receives about half of the company's revenues through income taxes or dividends.

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