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Resources and transmission routes for the Czech Republic

The territory of the Czech Republic is intersected with a system of transit gas pipelines which transmit Russian natural gas to major customers in Central and Western Europe in a quantity which is several times higher (approx. 34 bcm) than the domestic consumption in the Czech Republic is (nearly 8 bcm). Thanks to the transit system, the Czech Republic also has a very good access to other European markets, particularly the German and Austrian ones.

Medium term horizon

The potential of the Czech Republic as an important transit country will be strengthened even more after commissioning of the new gas pipeline Capacity4Gas, which will become an important connecting line between the Nord Stream II gas pipeline and customers in Austria and Italy. The long-planned STORK II interconnector, which would facilitate better interconnection with the Polish gas system and LNG terminal in Świnoujście, is not a priority project in terms of the security of supply to the Czech Republic. Nonetheless, it might contribute to increased commercial exchange between the two countries and an increased diversity of gas supply to the Czech Republic. The possible support for its realization is now being discussed between Energy Regulatory Office and the TSO.

Currently, natural gas from Russia accounts for approximately two thirds of gas imported to the Czech Republic and this ratio should not drop until 2035 – on the contrary, it might strengthen in relation to the ratio of the price of gas on offer in European markets to prices arising from the Russian contract. In addition to the small quantity of gas coming from domestic extraction (about 2% of the total supply), the only alternative resource is represented by gas purchased on gas exchange in neighbouring countries (mostly Germany).  Synthetic methane and the domestic gas production is shown in the following table.

Synthetic methane and the domestic gas production

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Long term horizon

In the long term, Russian gas will continue to dominate among suppliers to the EU, thus hypothetically increasing dependence of the Czech Republic on Russian gas. In addition to Azerbaijanian gas (TANAP and TAP gas pipelines are under construction) and gas coming from the eastern Mediterranean (EastMed gas pipeline project focused on Israeli, Cyprian or Egyptian gas sources), another promising area allowing increased diversification of gas sources for EU countries involves liquefied natural gas. The level, at which the capacity of LNG terminals in Europe is currently used, is very low (approximately 24%), which is a result of relatively higher prices in comparison to majority of gas which comes through gas pipelines from Russia or Norway. In the long run, the lower the domestic gas production in the EU and the lower the supply from Norway and Algeria after 2030, the higher the attractiveness of LNG in the EU despite its potentially high price.