Diversification of Poland's natural gas supplies still in debate

Jul 15, 2001 02:00 AM

According to both the Polish government and president, the recently signed agreement on constructing a natural gas pipeline from Denmark to Poland would guarantee Poland's energy security. The opposition has other ideas. The parliamentary opposition party, the Democratic Left Alliance (SLD), insists that importing gas from Germany via a pipeline from Bernau to Szczecin would be a more favourable option for Poland, and the next government may move to annul the agreement with Denmark.
"This is the first step toward diversifying gas deliveries to Poland," said Prime Minister Jerzy Buzek after signing the Danish agreement July 2. The agreement provides for Denmark's DONG company to build the pipeline between the two countries and deliver natural gas from Denmark to Poland.

The need to diversify Poland's natural gas supplies has been a hot political subject since 1990. Poland presently buys more than 90 % of its gas from Russia, going against European Union standards stating that countries must purchase gas from at least two different producers.
The opposition is critical of the contract. SLD leader Leszek Miller, whose party will most likely take over power in September's parliamentary elections, lambasted the deal the day after it was signed. He said the new government formed in the wake of the upcoming elections may revise the agreement and even abandon it if experts decide that it's unfavourable for Poland.
"Buzek's government annulled the Polish-Israeli agreement on the implementation of the Huzar program [an anti-tank rocket produced in Israel]," Miller said. "The government decided that the contract was against Poland's interests. So the new government may do the same with regard to the Danish agreement." Miller said that SLD certainly doesn't oppose diversified gas deliveries for Poland, but in his opinion a more favourable option would be to build a gas pipeline from Bernau to Szczecin. "This pipeline could be used to access the entire European network, which also carries gas from Norway, The Netherlands and Britain," said Miller.

Deputy Prime Minister and Economy Minister Janusz Steinhoff said that the contract with DONG is a great success for Polish negotiators, and gas imported from Denmark will be cheaper than the that gas that would flow from Bernau. In his opinion, the next government should support the Polish-Danish contract simply because the deal is good for Poland.
"I don't think we could buy gas at a lower price anywhere else in Europe," Steinhoff said. "Of course Danish gas will be more expensive than Russian gas, since Russian gas is the cheapest. We have decided to build the gas pipeline [from Denmark to Poland] as part of the program for diversifying gas supply sources for our country."

As far as future gas deliveries from Norway are concerned, Steinhoff said the Norwegian corporation Statoil may purchase a third of the stock in a consortium created by Polskie Gornictwo Naftowe i Gazownictwo (PGNiG) national oil and natural gas extraction company and DONG. The consortium is expected to supply gas to Poland from Denmark.
"The agreement includes an option opening it to other partners," Steinhoff said at a press conference in Warsaw July 5. "For the time being, PGNiG holds one-third of the stock in the consortium and DONG holds two-thirds, while the possibility exists of allowing the Norwegian partner to buy one-third of this stock."
PGNiG Chairman Andrzej Lipko has said that he sees no reason to break the agreement in the future. The planned construction of the gas pipeline from Redvig in Denmark to Niechorze in Poland is advantageous because north-western Poland experiences problems receiving the necessary quantities of natural gas.
President Aleksander Kwaniewski has stated that Denmark is a more realistic and cheaper partner than Norway today. "Unfortunately, only in the short term," he added. "But we must remember that by striking a deal with Denmark, we secure an opportunity to later take advantage of the existing system for supplying gas from more distant regions like Norway."

It was reported that other Baltic Sea countries are also interested in the Polish-Danish plans for building the gas pipeline. Thanks to the project, they could reduce their dependence on Russia for energy. Estonia's Prime Minister Mart Laar has said that the three Baltic nations should develop a joint strategy for the potential use of the planned natural gas pipeline from Denmark to Poland.

Source: The Warsaw Voice
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