The supply of converted high-calorie gas to the Norg storage site and Germany's Gaspool market area may significantly shift the scope for Dutch blending between seasons, with a pronounced fall expected in winter.
The set-up of the Groningen transport system is to be modified from this summer to allow Norg to be filled with low-calorie gas that has been created through quality conversion, by adding nitrogen to high-calorie supply. Norg could previously only be filled using direct output from the Groningen field.
This measure could allow Dutch nitrogen ballasting units to be operated closer to capacity this summer, lifting Dutch high-calorie import demand for quality conversion and facilitating a fall in Groningen production (see graph). The government aims to ramp down production from the field as quickly as possible to minimise seismic activity in the region.
But while the use of converted gas for Norg injections will bolster high-calorie demand for quality conversion in summer, this may be at least partly offset by significantly less high-calorie gas being used for blending the following winter.
System operator GTS blends low-calorie supply by mixing it with high-calorie gas, lifting its Wobbe value to the upper end of the limit that keeps it compatible with compliances designed to burn low-calorie gas (see graph). This reduces the amount of Groningen gas that is required to meet low-calorie demand. Groningen gas has a Wobbe value of 43.8 MJ/m³, while the Wobbe index of gas can be lifted to a maximum of 44.4 MJ/m³ for low-calorie customers in the Netherlands and as high as 46.5 MJ/m³ in Germany, France and Belgium.
With Norg to be filled with converted high-calorie gas — which is already raised towards the top end of the Wobbe range that is permissible — there will be less scope to add high-calorie gas to low-calorie gas entering the grid the following winter, but possibly more scope this summer.
The Norg stockdraw averaged just under 30mn m³/d on 1 October-25 March, assuming a GCV of 43.8 MJ/m³ (see graph). Based on the correlation between aggregate Groningen output for sale and blending in October 2017-February 2020, this would have been mixed with 21mn m³/d of high-calorie gas — or a cumulative 3.7bn m³.
It will not be possible to maintain Norg withdrawals as quick next winter — limiting the effect of having to mix Norg withdrawals with little or no high-calorie gas.
Stocks at the facility can only be partly replenished this summer — a technical limitation of filling it with converted gas. Inventories are expected to reach 4bn m³ at the start of the winter, which would be down from the 5.46bn m³ to which they were revised up on 10 October 2019 after operator Nam was allowed to use more working gas at the facility (see graph).
But the reconfiguration of Norg could increase the scope for blending this summer.
The requirement to fill Norg with converted high-calorie gas could result in more direct Groningen field offtake having to be used this summer to meet northwest Europe's low-calorie demand — which could in turn allow for more blending.
GTS only expects the reconfiguration of Norg to reduce demand for Groningen gas by 800mn m³ this summer, further suggesting that while no Groningen gas will be needed for Norg injections, this will be partly offset by more being required to meet low-calorie demand.
A second measure to be implemented from 1 April which could pare GTS' ability to mix high-calorie gas with low-calorie supply, particularly in winter, is the supply of converted gas to Gaspool. The market area has previously been supplied with low-calorie exclusively from Groningen's De Eeker and Zuiderpolder clusters.
Exports to Gaspool at the Oude Statenzijl-Bunde border point averaged just over 9mn m³/d on 1 October-25 March — to which around 14mn m³/d may have been added, based on the correlation between output for sale and blending for exports in October 2017-February 2020. But GTS may not be able to fully substitute Groningen supply for converted high-calorie gas.
This measure could also cut into the scope for summer blending, although exports to Gaspool are lower in summer, when heating demand is minimal. But it could contribute to a rise in Groningen field offtake to meet overall low-calorie demand, similar to the Norg changes.
GTS sees stable blending ratio over full gas year
GTS still expects the overall scope for blending in the 2020-21 gas year to hold steady from previous years, suggesting that the use of blending may merely be shifted to the summer from the winter.
GTS foresees that in a scenario with Groningen production of 9.3bn m³ in the 2020-21 gas year, 7bn m³ of high-calorie gas can be used for blending. This would be in a scenario with heating degree days in De Bilt in line with the long-term average, according to GTS' suggested formula for next gas year. In a cold weather scenario, permitted Groningen output would rise to 14.3bn m³ while blending would also step up, to 9bn m³.
The ratio of blending to output for sale projected by GTS matches exactly with the correlation for October 2017-February 2020 (see graph).
Given that GTS does not expect a change in the scope of blending in the 2020-21 gas year as a whole, this suggests that less high-calorie gas being added to overall low-calorie supply in winter may be fully offset by more being mixed in summer.
