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Slovakia and Azerbaijan gas deal unlikely, SPP confirms

Slovakia and Azerbaijan gas deal unlikely, SPP confirms Photo: There is no agreement on gas supplies from Azerbaijan through Ukraine yet (Getty Images)

European companies have not reached an agreement to replace Russian gas imports through Ukraine with supplies from Azerbaijan. The Slovak state gas purchasing company, SPP, has denied media reports that an agreement is close, according to Reuters.

"We regularly discuss the topic with our partners, but the information about the upcoming conclusion of a gas supply contract with the participation of SPP is not true," SPP stated.

Two sources from the Azerbaijani energy company SOCAR also downplayed the report.

Bloomberg, citing informed sources, reported on October 31 that companies from Hungary and Slovakia were close to signing a contract to supply 12-14 billion cubic meters of gas per year from Azerbaijan.

SPP has been a leader in attempts to maintain transit despite the war between Russia and Ukraine, as alternative routes are more expensive.

Kremlin spokesman Dmitry Peskov was also skeptical about the agreement when asked about it during a conference call with journalists on November 1. "How events will continue to unfold, how supplies will continue to be ensured, taking into account the fact that Ukraine has already announced its refusal to extend this agreement, now I can't say anything," he said.

It is expected that 14 billion cubic meters of Russian gas will be exported through Ukraine this year, a small fraction of pre-war levels.

The current five-year agreement between Moscow and Kyiv regarding the export of Russian gas through Ukraine to Europe ends at the end of the year, forcing the European Union to look for alternative gas sources, including from Azerbaijan, while also negotiating to keep the route open.

Russia has stated that it is ready to continue supplies through Ukraine despite the war, while Kyiv has refused to negotiate with Moscow regarding gas transit.

Earlier, Slovak Prime Minister Robert Fico stated that he expects cooperation from Ukraine in importing oil and gas to Slovakia.

According to RBC-Ukraine, Ukraine has proposed a new gas supply scheme to Slovakia and Azerbaijan through its territory to the European Union. The option of storing gas in Ukrainian underground storage facilities with subsequent supply to Slovakia or other countries is being discussed. As a result, such supplies would be considered re-exports rather than transits.