The joint purchase of gas helps European companies build new business relationships with alternative suppliers as the EU seeks to reduce its dependence on Russian gas.

The European Union (EU) on May 10 launched the first international tender for a joint purchase of gas to get a better price to replenish its reserves before the winter of 2023-2024. Speaking to the press in Brussels, European Commission (EC) Vice President Maros Sefcovic stressed: "This is a historic step. We are leveraging the EU's collective economic strength to strengthen security. energy and against high gas prices."

For this first tender, 77 European companies submitted requests for a total volume of approximately 11.6 billion m3 of gas, including 2.8 billion m3 of liquefied natural gas (LNG) and 9.6 billion m3 delivered via pipeline. International gas suppliers, excluding Russia, will send quotes by May 15. If the transaction is signed, deliveries are expected to take place from June 2023 to May 2024.

Maros Sefcovic affirmed that the joint purchase of gas led by Brussels helps European companies, especially in energy-intensive sectors, to build new business relationships with alternative suppliers when The EU seeks to reduce its dependence on Russian gas. On the other hand, this mechanism also gives international suppliers the opportunity to expand their customer network.

According to the EC, new tenders will take place every two months until the end of the year. Companies from the EU, as well as from the countries of the "European Energy Community" such as Ukraine, Albania, Bosnia, Kosovo, North Macedonia, Georgia, Moldova, Montenegro and Serbia can participate in aggregate demand submission. The mechanism is part of measures adopted by the EU in 2022 to deal with the energy crisis following the Russia-Ukraine conflict. 

Under the rules finalized in mid-December 2022, EU countries must participate in this aggregate demand mechanism to collectively buy at least 15% of the volume needed to achieve the EU's goal of filling 90% stockpile by November. The joint purchase of gas must also ensure that it avoids a situation like the summer of 2022, when countries and companies rush to the gas market at the same time to fill their reserves, causing prices to spike.

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