30 years of natural gas in Finland

On Friday, 9 January 1974, President Urho Kekkonen inaugurated the natural gas transmission system in Finland. The natural gas transmission pipeline at that time was 130 kilometres long and annual sales of natural gas totalled 442 million cubic metres. Thirty years later, the natural gas transmission system is 1,000 km long and annual consumption of natural gas 4,796 million cubic metres,  equivalent to around 11 per cent of Finland's total energy needs. A total of 65.3 billion cubic metres of natural gas have been imported into Finland over the past thirty years.

Impulse to develop trade with Eastern Europe

Neste and the former Soviet Union signed a natural gas supply contract in 1971. Finnish industry had become interested in natural gas. President Kekkonen, too, strongly pushed for imports of natural gas as part of an initiative to develop trade with Eastern Europe. 
Work on building the natural gas pipeline in Finland started in 1972. The pipeline was connected to the Soviet pipeline at the frontier in October 1973 and the first pilot deliveries to customers took place in late December the same year. Hackman's Honkalahti sawmill in Joutseno and Enso-Gutzeit's production facilities at Tainionkoski in Imatra were the first natural gas users in Finland. Now part of Stora Enso, both these facilities continue to use natural gas.

District heat a major growth factor for natural gas

During the first ten years, industrial plants, especially in the forest industry, were the biggest users of natural gas. Since the mid-1980s, use of natural gas to produce district heat has resulted in a significant increase in the consumption of natural gas. In 1986, natural gas began to be used in Tampere, Hämeenlinna, Vantaa and Lahti. The same year, Helsinki made a decision to become natural gas user. This became effective in 1990 with the completion of a new natural gas-fired power plant at Vuosaari.

Increased use of natural gas also called for investments in the natural gas transmission system. A 450 -km pipeline extension to Pirkanmaa and the Helsinki Metropolitan Area was completed in 1986.

Transmission capacity was also strengthened by the acquisition of two compressor units at the natural gas reception station in Imatra.  
With the introduction of natural gas in Helsinki, town gas, which was produced from liquefied gas and distributed in the gas distribution network in the inner city, was replaced by natural gas. Changing the gas required a host of adjustments both to the distribution network and to gas appliances. This work was carried out between 1991 and 1994, after which more than 30,000 private households and restaurants using gas cookers joined the natural gas users.

The first natural gas-powered buses used in Helsinki transport were introduced in 1996.f The buses were operated by the company Tammelundin liikenne Oy. Helsinki City Transport started operating natural gas-powered buses in 1998.

A reat power collapses, gas deliveries continue

Headed by gas minister Viktor Chernomyrdin, a start was made on incorporating the gas business, which during the Soviet Union had operated under the aegis of the Ministry of Gas. Gazprom was established in 1986 and Sojuzgazexport, which was renamed Gazexport, became part of Gazprom in 1992. 

Gas deliveries continued normally during the collapse of the Soviet Union in 1991-1992. Likewise, the Baltic states continued to receive natural gas when, despite Russian opposition, they were pushing for independence. A new supply contract signed between Finland and Russia in 1994 ensured the continuation of natural gas imports to Finland.

The next extension to the natural gas grid in Finland took place in 1997, after which there were 900 km of natural gas pipeline. The building of a parallel pipeline and the addition of five new compressor units to the natural gas grid safeguarded transmission capacity. M-real's Kirkniemi pulp mill in Lohja, Nokian lämpövoima and Neste's refinery at Kilpilahti in Porvoo joined the host of natural gas users.
Transition from Neste's natural gas unit to the Gasum Group
Natural gas became a separate unit within Neste in 1972, when work started on building the natural gas pipeline. In 1994, the natural gas unit was formed into a Neste subsidiary and named Gasum, whose shareholders were Neste and RAO Gazprom.

In 1987, Neste's subsidiary Tehokaasu Oy acquired the gas plant and facilities from the City of Helsinki. The following year, Tehokaasu's city gas division became Helsinkikaasu Oy, which assumed responsibility for the distribution of town gas in Helsinki.

Helsinkikaasu became a subsidiary of Gasum. Today, another of Gasum's subsidiaries, Suomen Kaasuenergia Oy, is responsible for local distribution operations, whilst Helsinkikaasu focuses on the provision of natural gas appliances and service. Additionally, Gas Exchange Ltd in Finland and Gaasienergia AS in Estonia are part of the Gasum Group.

Gasum's ownership base grew in 1999. Imatran Voima and Neste merged to form Fortum. Competition legislation resulted in Fortum having to divest part of its stake in Gasum. Fortum retained a 25 per cent stake in Gasum and sold the rest of its Gasum shares to the Finnish state, German gas conglomerate Ruhrgas and Finnish forest companies.