Polish Briefing 21 January, 2019 9:00 am   
Editorial staff

Polish Briefing: Liberalization versus diversification of the gas sector

What goes on in Poland on the 21st of January.

Gaz-System investments

The growing demand for gas at the rate of 1 billion bcm annually, new Gaz-System investments, market liberalization needs – these were the main themes that appeared during the “Polish energy and gas market” panel, which was held as part of the POWERPOL 2019 conference under the patronage of

Sławomir Sieradzki, director of the Gas Market Development Division at Gaz-System, said that the investment plan for the next 5 years is PLN 10 billion. – It’s about building a gas connection with Denmark. We already have investment decisions, we will be able to start business tenders, thanks to a signed agreement between operators and political agreement in Denmark. The tenders should start this year, the last one should end in early 2020. The construction works should take a year and will cover a stretch of 250 km. The second element is the expansion of the LNG terminal. Investment decisions were taken to increase the regasification capacity from 5 to 7,5 bcm, to build a second seafront with the possibility of reloading and to increase the number of fillers, also for railway cisterns. Other investments concern construction of North-South Line, connecting Poland with Slovakia and Ukraine. Part of the work is already commissioned in the field of construction – he said.

Urge the Commission to help finance the construction of a gas connection in Ukraine

He added that with regard to Ukraine, the non-binding market survey of 2018 showed that the export volume is up to 4 bcm annually. Soon Ukraine’s contracts with Russia and with Slovakian networks expire and companies that trade gas will appear on this market. – We are talking with Ukraine about the use of the system that is already and about expanding with a new, effective system. We are talking with the European Commission about the possibility of financing the development of the Ukrainian network. Gaz-System will not invest in Ukraine. We want to organize funding with the help of the EU. On the Polish side, this is a construction of 1,5 km, and on the Ukrainian side over 100 dozens of kilometers of the section. At the same time, presidential elections overlap and gas, also on Ukrainian side, is a very political issue. Until then, we are using the current connection as efficiently as possible – said Sieradzki.

Gas connections with Lithuania and Slovakia are getting closer. The interconnector with the Czech Republic is stuck

He added that Gaz-System implements two cross-border projects. The first one is the Poland-Lithuania connection, where the design phase ends and construction work will commence soon. The second one is the Poland-Slovakia gas pipeline, where a 50 km section is to be built and the construction works will start soon. He mentioned that on the Slovak side they have already begun, and the project should be completed in 2021. He also mentioned that talks are under way regarding the Lasów point, on the border with Germany, and it concerns the expansion of the network to 1,5 billion cubic meters of transmission capacity towards Germany. So far, there is a possibility of transmission towards Poland.

When it comes to the connection between Poland and the Czech Republic, Sieradzki said that he has no decision yet and will probably not be in this year either. – The point is to create a system of incentives for the private network operator to guarantee profits. The talks are conducted with the Czech regulator and the European Commission – remarked Sieradzki.

He added that Gaz-System will soon be discussing the development of the transmission network, which is to take into account changes in the market. – Due to the growing gas consumption, new investments will be needed to satisfy potential investors. We know that today the energy industry is focused on coal, in the next years it is to use gas, and then from RES and gas. We assume that in the next years the possibilities of importing gas to Poland will reach up to 50 billion cubic meters – he said.