GAS 11 September, 2019 10:00 am   
COMMENTS: Mateusz Gibała

PGNiG: Poland wins OPAL case

On September 10th, 2019, the Court of Justice of the European Union, on an application from the governments of Poland, Lithuania and Latvia, annulled the European Commission’s Decision No. C(2016) 6950 of October 28th 2016 enabling the monopolisation of access to the OPAL gas pipeline. The Court found that “the contested decision was adopted in breach of the principle of energy solidarity”. It confirmed the arguments of Poland that the EC, by issuing the decision, violated the principles of the European Union by not examining its impact on Poland’s energy security.

The EC Decision approved the monopoly on the use of Germany’s OPAL gas pipeline given to Gazprom by the German energy regulatory authority. PGNiG S.A., PGNiG Supply and Trading GmbH, Ukraine’s Naftohaz and the governments of Poland, Lithuania and Latvia filed a complaint against the Decision in December 2016.

“It has been evident since its issue in 2016 that the EU Decision concerning the OPAL pipeline is in conflict with EU law, particularly the Third Energy Package. The Commission failed to consider, among other things, the impact its decision would have on the gas markets in Poland, Lithuania and Latvia and other Central European countries. EU energy legislation is designed to prevent the monopolisation of access to gas pipelines within the Community. We are glad that the Court of Justice of the European Union has clearly affirmed that EU legislation applies equally to all, including Gazprom. Expressions of gratitude are owed primarily to the employees of the Ministry of Foreign Affairs and the Ministry of Energy responsible for the case,” said Piotr Woźniak, President of the PGNiG Management Board.

The judgment of September 10th, 2019 does not end the proceedings before the Court of Justice of the European Union because the judgment may be appealed by the European Commission. However, as the judgment is immediately enforceable, the EC Decision on OPAL became ineffective as of September 10th 2019.

“The Court’s judgment has another significant aspect,” added Maciej Woźniak, Vice -President of the PGNiG Management Board. “Following the judgment annulling the decision which gave it a monopoly on the access to the OPAL gas pipeline, Gazprom must reduce its utilisation of Nord Stream 1 to the level permitted in 2015. Therefore consequence of this will be transmission of the remaining volume of gas via Ukraine. As Gazprom can no longer enjoy its monopolistic position on the OPAL pipeline, it will not be able to terminate transit of gas to Europe via Ukraine, at least in the coming months. The Court’s judgment may save Ukraine and Europe from the market turbulence like that of January and February 2009”.

OPAL gas pipeline is owned by joint venture company WIGA Transport Beteiligungs-GmbH & Co. KG. WIGA’s shareholders are Wintershall Holding GmbH (50.02%), a daughter company of BASF, and PAO Gazprom (49.98%). WIGA also owns the German transmission network Gascade and the Nel gas pipeline – the Nord Stream extension to the west.