2.2.3. Discontinued Supplies in 2007–2009

While prioritisation of growing domestic gas consumption continued, it was not the main reason for falling LNG exports. During 2000–2006, gas consumption increased by 1% per year, and LNG exports declined by 3.2% per year [5]. Since 2006, the main reason for falling LNG exports was declining gas production, which was due to failure to attract investments. As a result, in 2007, Pertamina did not renew a contract for 3.1 bcm with South Korea. In March 2008, Pertamina reduced LNG supplies to Japan for the post-2010 period, from 16.3 bcm to 4.1 bcm for the first five years and 2.7 bcm afterwards. This reduction

was crucial for Japan, as 16.3 bcm represented about 20% of Japan's annual LNG imports. In 2009, Pertamina did not renew a contract for 2 bcm with Taiwan [5,32].

#### *2.3. Russia*

Russia is the largest natural gas producer and has the largest reserves in the world. Gazprom is the main producer of natural gas in the country with monopoly rights over gas exports. In 2017, Russia accounted for 35% of total European imports [33]. Russian gas will continue to dominate European gas supplies over the next decade [18]. Most of the Russian gas supplies to Europe passed through Ukraine, Belarus and Moldova. These transit countries are also heavily dependent on deliveries of Russian gas.

During the 1990s and 2000s, there were numerous gas disputes between Russia and these transit countries, emphasising the need to study the mutual dependence of suppliers and transit countries. The disputes arose due to accumulated debts, Russia's price demands, theft of gas in transit to Europe, and Russian pressure to exchange debts for a share in gas transit networks [2].
