In order to use short-haul, shippers (both residents and non-residents) should do the following:• Sign a template contract with the TSO;• Be registered on the Informational platform of the TSO;• Receive a separate shipper-code for the short-haul product; • Either book a monthly product (by submitting a filled-in capacity request 30 days before the beginning of the month of transportation) or work on a day-ahead basis (with implicit booking together with nominations); • Have a preliminary customs declaration (for the customs mode “transit”) prepared and capacity prepaid before the transportation;• No financial guarantee is needed;• No payments for multipliers and seasonal factors for short-term standard capacity products are needed.

How to use short-haul product

Ukraine

Poland

Hungary

Romania

Slovakia

Moldova

Contact us:

For instance, if a shipper needs to transport gas from Poland toHungary, it will have to pay to the Polish TSO 0.62 € per MWh,after that 0.25 and 0.35 to enter and exit UA GTS for theshort-haul product and 0.35 € per MWh to enter the system ofHungarian TSO (1.57 € per MWh in total).

Alternatively, shippers can transport natural gas from Poland to Hungary through Czech Republic and Slovakia and pay in total 2.15 € per MWh, which is 27% more expensive than the short-haul product. Moreover, the UA route capacity is up to 95.4 GWh per day, while via Czech Republic and Slovakia – only 30.5 GWh per day on interruptible basis can be transported. commercial@tsoua.com

+380444612120

tsoua.com

Commercial division

Business development division

businesscooperation@tsoua.com +380442397817

How it works

Security of Supply & Storage Last but not least, signing transportation contract with the UA TSO does not cost anything, but it gives you immediate access to the short-haul service, which can be used in case of need to cover addi-tional demand, in particular, in case of security of supply crisis situa-tions in the EU countries. Moreover, shorthaul can be combined with customs warehouse – special customs regime, allowing to temporary store natural gas in Ukrainian storages (UGS) for 1095 days without paying taxes and customs duties. Combination of the two services creates synergy – significant discount for tariffs of cross-border IPs multiplies the interest of potential users of UA storage facilities which are themselves among the cheapest ones in Europe.

INTRODUCINGSHORT-HAUL

Short-haul – is a special service, which allows for discounted transmission between dedicated interconnection points with adjacent countries. UA Network Code specifies short-haul as«capacity with restrictions».

With significant reduction of Russian transit, UA TSO has large part of capacities of cross-border interconnection points in the Western Ukraine unutilized and can be offered for all shippers.

The short-haul service provides the instrument for traders and shippers to use the capacities under very attractive tariffs, reach-ing the markets of Poland, Hungary, Slovakia, and Romania via Ukrainian GTS. This product is only for transit services and does not provide access to the Ukrainian VTP and internal market.

Logic of the service from the TSO’s point of view is the following: in case the capacities of interconnection points are not booked under standard products the TSO can offer the short-haul service for designated pairs of the interconnection points, which are usually at a short distance from each other.

Starting from 1 January 2020 new service is available to users of Ukrainian gas transmission system services – short-haul transportation.

Short-haul tariffs are on average almost 4 times cheaper than the standard ones in case of booking day-ahead products.

Tariff standard (€ per MWh) Tariff «short-haul» (€ per MWh)

What is short-haul

Tariffs comparison DirectionShorthaul tariff of the UA route,

€ per MWh

Tariff of alternative EU route**,

€ per MWh

Capacity of the UA route,

GWh per day

Capacity of the alternative EU route**,

GWh per day

PL – RO 1.75 ↓ 3.14 95.4 ↑ 30.5

RO – PL 2.45 ↓ 4.04 145.2 ↑ 21.5

SK – RO 1.69 ↓ 1.82 145.2 ↑ 77.5

RO – SK 1.8 ↓ 1.81 145.2 ↑ 21.5HU – PL 2.05 ↓ 2.88 178.1 ↑ 30.5PL – HU 1.57 ↓ 2.15 95.4 ↑ 30.5SK – PL 2.19 = 2.19 178.1 ↑ 30.5

PL – SK 1.58 ↑ 1.29 95.4 ↑ 30.5

HU – RO 1.56 ↑ 0.99 145.2 ↑ 77.5RO – HU 1.76 ↑ 1.17 145.2 ↑ 21.5HU – SK 1.59 ↑ 0.64 517.3 ↑ 50.8SK – HU 1.5 ↑ 0.82 771.7 ↑ 129.1

The short-haul tariff creates a new attractive route in addition to other existing transmission directions via EU, which are ei-ther fully booked, or have minor capacities available.

1

2

3

4*

0.25

0.380.71

0.250.71

0.301.55

0.250.71

0.351.48

1.400.31

0.25

-44% +313%

-29% +584%

-7% +187%

-39% +675%

-27% +313%

-1% +675%

+22% +313%

+584%

+50% +675%

+148% +1018%

+83% +595%

+58% +187%

0.71

1.44

PL–UA

SK–UA

HU–UA

RO–UA

UA–PL

UA–SK

UA–HU

UA–RO

UkrainePoland

Hungary Romania

Slovakia Moldova

1

23 4

New & attractive gas transmission routes connecting EU markets

NOW 4 TIMES CHEAPER

* To be available when interconnection agreement for IP Tekovo is signed. ** Tariff calculated for monthly products based on data on open sources (TSO web sites).

Moreover, the short-haul tariff opens number of previously too expensive transportation routes. For certain routes the short-haul product is up to two times cheaper than the other alter-natives. Unlike the standard products provided by the otherTSOs, short-haul allows fully-flexible regime of its using.

UGS