Poland reacts to withdrawal of permit for Baltic Pipe
Denmark has cancelled permission for the construction of the gas pipeline from Norway to Poland due to “insufficient knowledge” of potential environmental damage. The operator of the pipeline Baltic Pipe is suspending work. If the project falls behind schedule, Poland may not be able to negotiate a discount from Gazprom next year when its long-term contract for Russian gas supplies to the country expires, experts say.
The Danish Environment and Food Appeals Board has withdrawn permission for the construction of the Baltic Pipe gas pipeline, which would connect Norway and Poland along the Baltic Sea bed. This was announced by the press service of the Danish transport system operator Energinet.
According to the Danish regulator, construction would destroy habitats for small animals such as dormice, wood bats and bats, and the operator has not sufficiently detailed its plans to protect them.
“We will carry out a thorough assessment of how this will affect the Baltic Pipe project and especially construction in areas where specially protected animals live. Baltic Pipe is a major infrastructure project that crosses all of Denmark. There is no way that the areas we are working in will not be affected, but we will make every effort to minimize the impact on nature and human life, and ensure that protected species will be well protected during and after the construction of the Baltic Pipe”, – said Marian Kaag, Deputy Director and Head of Construction Project at Energinet.
Polish Deputy Foreign Minister Pawel Jablonski told the Polish media that construction of other sections of the pipeline will continue.
“We have enough reasons to believe that work on the Danish section affected by this decision will only be stopped temporarily until the investor satisfies the environmental and legal requirements [of the regulator]”, – Pavel Jablonski added.
“Empty Pipe”
Launched in October 2022, the Baltic Pipe is for Poles an important part of their strategy to diversify their fuel supplies and reduce their gas dependence on Russia. Poland’s long-term agreement with Gazprom for supplies of Russian gas expires at the end of 2022. Poland has repeatedly announced that it does not plan to extend this agreement, but the country will not be able to give up on Russian gas either, with or without the Baltic Pipe, experts say.
“The main problem with the Baltic Pipe pipeline is not the construction delays, but the fact that it will be a de facto empty pipe. Norway’s gas production has been falling for the fourth year, and in order to fill Baltic Pipe, it is necessary to re-buy the gas that is currently flowing to Germany from Norway. Poland has only about 2 billion cubic meters of gas contracted, and with its capacity of 10 billion, it will stand empty. “
It is extremely important for Poland to build the Baltic Pipe in order to have arguments when discussing the terms of new supplies with Gazprom,” Igor Yushkov, a leading expert at the National Energy Security Fund, explained to Gazeta.ru.
As Yushkov notes, the Poles said they would not sign a long-term contract after 2022, but did not say they would not sign any agreements at all. They will have to sign mid-term or short-term contracts because the country’s demand for gas will grow strongly in the coming years due to the EU requirements that Poles reduce coal-fired generation. And they will replace it primarily with gas, the analyst believes.
The operator of the Polish gas pipeline network, Gaz-System, stated in April that over the next 10 years it expects gas demand to increase by 50%, and in some periods even by 100%.
“For Poland, the average European price with a link to the gas hub prices is going on right now. Even with the availability of Baltic Pipe it would be difficult to reduce the price, and here even to threaten that “now we will switch to the Norwegian gas and will not buy anything from you” will not be possible, if Baltic Pipe is not commissioned in time in 2022,” – sums up the leading expert of the National Energy Security Fund.
Margarita Sobol, gazeta.ru