Voestalpine secures gas supplies, prepares cut-off contingency plan

Voestalpine is not affected by the current throttling of gas supplies from Russia via the Nord Stream 1 pipeline in the Baltic Sea, the company says.

Its Austrian production sites are currently receiving most of their required gas volumes via the Transgas pipeline running through Slovakia. The group is also thoroughly prepared should there be a further reduction or complete stop in gas supplies from Russia, it adds.

Contracts for alternative supply volumes have already been signed, with voestalpine starting to fill its own gas storage facilities in May, Kallanish notes.

Natural gas is primarily required for heat treatment processes and for the rolling mills, above all in Linz, Donawitz, and Kapfenberg. The recent amendment to Austria’s Energy Intervention Powers Act (EnLG) now allows the voestalpine Group to build up its own stores of natural gas.

In May, voestalpine also contracted its own gas storage facilities for the first time. The group will store up to 1.5 TWh of gas at storage facilities including RAG Haag and Haidach. This volume is sufficient for three months of operating at full capacity, or correspondingly longer at reduced capacity. These facilities are currently half full and scheduled to be completely filled by mid-July.

“A stop in gas deliveries through Russia, or conversely an EU gas embargo, would hugely damage European industry,” says voestalpine chief executive Herbert Eibensteiner. “However, should this worst-case scenario arise, having our own, full gas storage facilities, together with alternative sources of gas, would allow us to continue almost all production operations in Austria for several months.”

During the summer months, gas deliveries from overseas arriving at LNG terminals in Italy will be transported on to Austria, both for storage and to support ongoing production operations, the steelmaker says. In addition, an emergency plan has been drawn up for production to be incrementally adjusted to reflect available energy volumes, and would come into force in the event of any gas constraints.

Voestalpine also points out it would be able to offset some production bottlenecks internally, given it is an international group with 500 companies and sites worldwide