EU Awaits Further Measures Before Approving Poland-Russia Gas Deal
The European Union has called on Poland to prepare detailed measures for its natural gas market before getting the green light for a new supply agreement with Russia.
Russian exporter OAO Gazprom and state-controlled Polish distributor Polskie Gornictwo Naftowe i Gazownictwo SA reached a draft agreement in January to boost gas supplies in January. The final signature of an intergovernmental deal was delayed until last week after the European Union regulator said it needed to be adjusted to guarantee compliance with EU rules on pipeline management, access for third parties and pricing.
In a parallel deal, operators of the Yamal pipeline agreed last month that Poland’s Gaz-System SA will take over the local management of the pipeline from EuRoPol Gaz SA, a joint venture between Gazprom and Polskie Gornictwo, also known as PGNiG.
“We managed to ensure that the intergovernmental agreement between Russia and Poland was brought into line with EU law,” EU Energy Commissioner Guenther Oettinger told a briefing in Warsaw today. “Both the Polish authorities and my services agreed that the operator agreement will have to be complemented by further implementation measures.”
Under the intergovernmental accord signed on Oct. 29, PGNiG will be able to buy as much as 10.2 billion cubic meters of gas a year from Gazprom, up from 7.45 billion cubic meters in the previous contract. The central European country consumed 13.7 billion cubic meters last year, according to BP Plc data.
The increase in volumes would help Poland, which gets about two-thirds of its gas from Russia, to avoid the supply cuts faced by its chemical and oil refining industries earlier this year, when temperatures fell and a transit sources halted.
Halted Deliveries
PGNiG values the agreement at about 8.5 billion zloty ($3.1 billion) a year at current oil-linked prices. The company may save as much as $250 million by the end of 2014 if it uses the full discount offered by Gazprom, it said last week.
Poland has been seeking to raise gas supplies since early last year, when trader RosUkrEnergo AG, 50 percent-owned by OAO Gazprom, halted deliveries following a dispute between Russia and Ukraine. Under a contract that expired on Dec. 31, RosUkrEnergo was supposed to deliver 2.3 billion cubic meters of gas to Poland in 2009.
The measures that the EU expects Polish authorities to prepare are related to a network code that will lay down procedures for the calculation and allocation of available capacity, offering of reverse flow services, “non- discriminatory and cost-based” tariff setting, and future expansion of the Yamal pipeline, Oettinger said.
Poland received a final warning in July from the European Commission, the EU regulator, to remove restrictions in the natural-gas market or face a lawsuit. The commission said a Polish requirement that gas importers store a certain percentage of the fuel in Poland and a lack of access to the Yamal pipeline for supplies from Russia violate EU rules making the 27-nation bloc free of market barriers.
Source: Bloomberg