Press release: Denmark and Poland look into gas pipeline

2 May 2007 by  Bente T. Valentin

Energinet.dk and the Polish oil and natural gas company PGNiG, Polskie Górnictwo Naftowe i Gazownictwo Spolka Akcyjn, have concluded an agreement to explore the possibilities of establishing a gas pipeline, called the Baltic Pipe, between Poland and Denmark.

If the Baltic Pipe becomes a reality, it will connect the Scandinavian natural gas systems and resources with the Polish system, which today is closely linked to the Russian system. The pipeline will give the Danish and the Polish gas markets access to more supply sources, improving the security of supply and gas market competition.

The Baltic Pipe project has close ties to another current project, the so-called Skanled project. Here, in cooperation with a Norwegian consortium, Energinet.dk is analysing the possibilities of importing Norwegian natural gas into Denmark. The gas is to be transported via an offshore pipeline going from Norway to Sweden and Denmark.

- Poland wants to explore the possibilities of importing Norwegian gas via Skanled, through the Danish natural gas system and the Baltic Pipe to Poland. In order to ensure the security of supply, we are interested in importing Russian gas to Denmark via the Baltic Pipe, ie we want gas to flow in both directions, thus ensuring a well-functioning market, says Peter Jørgensen, Vice President of Planning at Energinet.dk.

- The Baltic Pipe between Denmark and Poland will also increase the utilisation of a future Skanled pipeline from Norway to Denmark, thus enhancing the economy of the Skanled project even further. We are presently in the process of analysing the project.

- If the Skanled and Baltic Pipe projects are realised, transit compensation in connection with transporting Norwegian gas to Poland will help to finance the necessary reinforcements of the Danish natural gas system, says Peter Jørgensen.

If the Baltic Pipe project turns out to be profitable and it is approved by the authorities of the countries involved, the Baltic Pipe is expected - as a starting point - to be financed and owned by Poland.

- The Skanled and Baltic Pipe projects are a natural consequence of Energinet.dk's social responsibility in terms of ensuring the security of supply and a well-functioning gas market. The projects are also a natural extension of the Danish government's proposal for a new energy policy, which was introduced on 19 January 2007. In this, the government emphasises the necessity of expanding the infrastructure in order to gain access to new gas reserves when the Danish extraction of gas from the North Sea starts declining after 2010. It is a perfectly natural step for Energinet.dk to assume this task, says Peter Jørgensen.

Additional information
Peter Jørgensen, Vice President, Planning, Energinet.dk, tel. +45 7622 4420.