Poland to construct pipeline to provide an alternative to Russian gas supplies

The Polish gas pipeline operator company Gaz-System will pay approximately €874 million for the construction of the Baltic Pipe from the North Sea to Poland, as stated by Gaz System, Wnp.pl reported.

 “The cost of constructing the gas pipeline on the bottom of the Baltic Sea is estimated at €442 million, another €342 million is for developing the Polish gas transport system, and Gaz-System will also cover 64% of the funds for the construction of a gas compression station, spending almost €91 million on this,” the web publication reports.

At the same time, the Polish company notes that the financial estimations are very approximate and could change significantly.

The Polish part of the gas pipeline consists of the maritime leg from the Danish island of Zealand to the Polish village of Niechorze on the coast of the Baltic Sea. The Polish company will also cover most of the funds for constructing a gas compression station on the island of Zealand. In addition, Poland will have to significantly develop its own network of pipelines in the country’s territory in order to be able to transport gas from Norway.

Several days earlier, the Polish and Danish governments signed a memorandum in Copenhagen regarding the joint implementation of the Baltic Pipe project, which will make it possible to replace gas from Russia in the future. The document envisages the making of the final decision to realize the investment in 2018, and the completion of the construction of the gas pipeline by October 2022. As Polish Prime Minister Beata Szydło said, this is a very important investment for Poland, related to the improvement of the energy security of Poland and the entire region. In total, the construction of the Baltic Pipe will cost roughly €1.7 billion.

Notably, the memorandum envisages “the necessity of supplying European consumers safe energy at an affordable price, and requires the creation of stable, diversified, safe and reliable gas markets in Poland, Denmark and also in the region of the Baltic and Eastern Europe”.

The Polish and Danish governments pledged to support and implement the project of Gaz-System (Poland) and Energinet.dk (Denmark).

Poland’s strategy entails diversification not only of sources, but also the direction of supplies. After 2022, when the so-called Yamal long-term contract with Russian Gazprom ends, shipments of gas will be based on the “Northern Gate”, that is, the pipeline transporting the deposits of the Norwegian shelf through Denmark to the Polish coast.

  Poland, gas pipeline