“It is highly regrettable that natural gas supplies under our supply contract will now be halted,” Gasum CEO Mika Wiljanen said, adding that the company has been “carefully preparing for this situation.”
Finland on Sunday formally announced its intention to join NATO, ditching decades of neutrality and ignoring Russian threats of possible retaliation in a bid to strengthen its security following the onset of the war in Ukraine.
Russian state gas giant Gazprom did not immediately respond to CNN Business when asked for comment.
Finland relied on Russia for nearly 68% of its natural gas consumption in 2020, according to the International Energy Agency.
But Russia’s gas exports account for just 3% of the Nordic nation’s total energy mix — which includes energy generated from biofuels and nuclear sources — according to data from Eurostat and the European Network of Transmission System Operators for Gas.
Wiljanen said that Gasum “will be able to supply all [of its] customers with gas in the coming months” provided there are no disruptions to the gas transmission network, but added that the winter would be “challenging.”
Gasum Vice President Olga Väisänen told CNN on Friday that Finland is also receiving gas through its Baltic connection via Estonia. The pipeline connects Finland’s gas transmission network to Estonia’s, and allows it to draw on underground storage in Latvia.
Since then, EU officials, national governments and energy companies have been scrambling to figure out whether the new payment mechanism contravenes sanctions on Russia.
But the European Commission insists that guidance it issued last week prohibits buyers opening a ruble account. EU Commission Chief Spokesperson Eric Mamer said at a Tuesday press briefing that such a move would breaches.
“Anything that goes beyond opening an account in the currency of the contract with Gazprombank and making a payment to that account, and then issuing a statement saying that… you have finalized the payment, contravenes the sanctions,” he said.
Earlier this week, the EU said it would spend €210 billion ($222 billion) to wean itself off Russian oil and gas.
— Robert North contributed reporting.