Poland agrees to sign gas supply deal with Russia

Oct 26, 2010 12:00 AM

The Polish government agreed to sign a new natural gas supply agreement with Russia after the central European country’s gas system operator completed a deal to take over the management of the Yamal pipeline.
Russian exporter Gazprom and state-controlled Polish distributor Polskie Gornictwo Naftowe i Gazownictwo, known as PGNiG, reached a draft agreement in January, but its final signature was delayed after the European Union regulator said it was assessing the deal’s compliance with EU rules on pipeline management and access for third parties and pricing.

Following several months of negotiations, Poland and Russia said on Oct. 17 they reached a draft intergovernmental agreement to align the contract with the EU regulations. A deal on the management of the Yamal pipeline, signed between Poland’s pipeline operator Gaz-System and EuRoPol Gaz, a joint venture of Gazprom and Poland’s Polskie Gornictwo Naftowe i Gazownictwo, was an important element in paving the way for signing the Polish-Russian accord, the government said.
Gaz-System said in a separate statement following the deal with EuRoPol Gaz that the energy regulator can now officially name the Polish company as the local operator of the Yamal pipeline.

Avoiding reductions
The gas supply contract would help Poland, which gets about two-thirds of its gas from Russia, to avoid supply reductions similar to those faced by its chemical and oil refining industries earlier this year when temperatures fell. It ensures supplies of around 10 bn cm until 2022, the government said.
It provides for transit of Russian gas to Germany until 2019, shorter than Russia had wanted, and allows Poland to re-export gas, Economy Minister Waldemar Pawlak said earlier.

The European Commission, the EU regulatory arm, “will pronounce itself within 48 hours” after receiving necessary documentation if the intergovernmental agreement is in line with the block’s law, energy spokeswoman Marlene Holzner said earlier.
Poland has been seeking to raise gas supplies from 7.4 bn cm annually since early last year, when trader RosUkrEnergo AG, 50 %-owned by Gazprom, halted deliveries following a dispute between Russia and Ukraine. Under a contract that ran out on Dec. 31, RosUkrEnergo was supposed to deliver 2.3 bn cm of gas to Poland in 2009.

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