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Polish Briefing 8 June, 2020 9:00 am   
COMMENTS: Mateusz Gibała

Polish Briefing: The Poland-Ukraine-US agreement on LNG supplies is waiting for Naftogaz’s decision

What goes on in Poland on the 8th of June.

The Poland-Ukraine-US Agreement on LNG supplies is waiting for Naftogaz’s decision

Polish Ambassador to Ukraine Bartosz Cichocki declared that a Polish-Ukrainian-American memorandum can be followed by an agreement on gas cooperation, but it depends on the decision of the Ukrainian Naftogaz.

– This is a very interesting gas business. We agreed on the memorandum between Poland, Ukraine and the USA signed in September 2019 on the supply of American gas through Poland to Ukraine. Despite this, parallel talks are underway between Naftogaz and Gazprom and we expect that the Ukrainian company will choose whether to buy gas from Russia or Poland – Cichocki told Interfax Ukraine.

Naftogaz announced on Twitter that it is not conducting talks with Gazprom. Poles are already sending gas to Ukraine. PGNiG sent 690 million cubic meters in the first quarter of 2020. This trade could develop a contract for LNG supplies from the US via Poland to Ukraine we signed, as described in BiznesAlert.pl. PGNiG announced last week that talks with Naftogaz have not yet resulted in a long-term contract, although contacts between them are ongoing.

Deliveries via the Yamal gas pipeline through Poland will get more expensive next year

The President of Energy Regulation Office (ERO) approved higher tariffs for Gaz-System and EuRoPol Gaz for 2021. The implementation of the Gaz-System tariff means an increase in rates at entry points by 10 percent. The higher tariff for EuRoPol will mean an increase in average payments for the gas transmission service via the Yamal Pipeline by 16,5 percent. The reason are Gaz-System investments, such as the expansion of the gas terminal or the Baltic Pipe.

The implementation of the Gaz-System tariff means an increase in rates at entry points by 10 percent for E gas and 13,1 percent for L gas compared to the rates in force in 2020. Rates at starting points will increase by 0,1 percent (E) and 2,1 percent (L) respectively. – The increase in rates results from significant strategic investments having a direct impact on Poland’s energy security, implemented by Gaz-System – reports the Energy Regulatory Office. It is worth recalling that Gaz-System is expanding the LNG terminal in Świnoujście and is a partner of the Baltic Pipe gas pipeline construction project to increase the capacity of gas supplies from outside Russia to Poland.