In the next two years Poland will completely replace Russian gas in its energy balance American liquefied natural gas (LNG). Warsaw argues that the supply from overseas is much cheaper raw materials “Gazprom”. Experts believe that Poland is in grave danger, as the transfer of fuel from alternative sources requires the development of new schemes of a stable supply. But the Russian gas sellers, while continuing to dominate in Europe, all the more clearly feel the increased competition and lose its position in the European energy market.
the Reason that Warsaw is going to completely abandon the “blue fuel” of our country is purely economic, to assure the representatives of the leading Polish energy company PGNiG. “Us LNG delivered by tankers costing Poland 20-30% cheaper than the Russian gas, — explains the Deputy head of the company Maciej, Wozniak. — Gas from the US has already started to arrive in the framework of long-term contracts. Its pricing formula is much cheaper than offered by “Gazprom””.
But the price of energy – values of the variables, and the demarche of Warsaw certainly has a strong political overtone. This year the Polish-Russian relations in the energy sphere reached its peak. Poland pointedly broke a contract with Gazprom on transit of gas in its section of the pipeline “Yamal-Europe”, and then our company had to book transport capacity on the exchange of pipeline operator Gaz-System.
at the same time Warsaw has won the Russian company in the Stockholm arbitration the claim for compensation of $1.5 billion for the supply of fuel at prices above market levels. The refusal to import Russian gas in favor of U.S. liquefied natural counterpart was another step Polish to a complete break energy relations with our country.
However, just to refuse the Russian deliveries in Warsaw are unlikely to succeed even with a strong desire. Russia exports to Poland 9-10 billion cubic meters of gas a year, covering up to 60% of the country’s needs for “blue fuel”, and quickly replace the shortfall in volumes of Warsaw will not be easy. However, PGNiG is not going to renew the contract with Gazprom, which expires at the end of 2022, and will then switch completely to raw materials from alternative sources.
So in Warsaw two and a half years to develop a scheme that will allow the country to maintain stable imports of gas comparable in volume with supplies from Russia. Yes, the export of liquefied natural raw materials in Poland is constantly growing. In the first quarter of 2020, it amounted to about 1 billion cubic meters, and LNG share in the Polish import of natural gas increased from 20% to almost 30%. But while these volumes are not up to procurement Techn- stand of “blue fuel” from Russia.
Poland argues that the current “inflated” prices “Gazprom” the country is losing up to $250 million a year. To save this amount, according to Warsaw, will allow the growth of the supply of liquefied natural gas from the United States. Already signed four agreements with American companies. In addition, the poles are going to provide for their needs at the expense of LNG from Norway. Deposits of the North sea are also linked with the Polish international market through the Baltic Pipe pipeline which is planned to put into operation just before the end of the agreement on deliveries from Russia.
if these plans? Theoretically, Warsaw has a chance to reduce to zero the dependence of “blue fuel” of our country. However, the risks suddenly feel the shortage of gas remain high. According to forecasts of world Bank experts, the export of LNG from USA, which at current low prices is unprofitable in the future will be greatly reduced. In may the American liquefaction plants have reduced production by 20%. A new collapse in prices and demand fluctuations, which, according to the head of the Center for the study of world energy markets energy research Institute of the RAS Vyacheslav Kulagin, can reach 15% per year may exacerbate the situation and cause further production cuts.
Timely deliveries at the Baltic Pipe is also questionable. Start of its construction was given at the end of this April. For two years the project participants have to build 230 km of pipes across the Baltic sea and weather conditions which, as the practice of the Russian “North stream – 2”, not always favored by the construction works.
nevertheless, there is increasing competition in the European gas market, where Russia was traditionally used to feel dominant force. However, in the first quarter of 2020, the supply of “Gazprom” in the European market, according to the Federal customs service, has fallen by almost a quarter. The most dramatic situation was observed in Turkish and German directions. Ankara imported 70% less Russian gas, and the purchase of “blue fuel” German consumers has dropped by 45%.
“it is clear that Poland is trying to go for broke and force Gazprom to reduce prices. However, if Warsaw will be able to redirect power flows and to fully replace Russian gas, it will show a great example to other EU countries, partly to weaken the hegemony of Russia in the European fuel mix,” warns Vyacheslav Kulagin.
