A signing of the Agreement on Rules of Cooperation for the Gas Interconnection Poland – Ukraine Project

Photo of the article On 6th December 2016 the Polish and Ukrainian transmission system operators – Gas Trnasmission Operator GAZ-SYSTEM S.A. and PJSC "UKRTRANSGAZ" signed the Agreement on Rules of Cooperation for the implementation of the interconnection integrating transmission systems of both countries, the Gas Interconnection Poland – Ukraine. The Agreement covers cooperation of both Operators in the area of the engineering and construction works.
The planned Gas Interconnection Poland – Ukraine includes the construction of a new gas pipeline between Hermanowice gas node on the Polish side and Bliche Volytsia on the Ukrainian side. The Project Promoters expect, that the new interconnection will enable to increase the transmission capacity to a maximum of 5 bcm/year in 2020, when also the expansion of the national transmission system in Poland will be completed.
The Gas Interconnection Poland – Ukraine is crucial for enabling of the gas transmission from the planned Northern Gate (Norwegian Corridor and LNG Terminal) through the national gas transmission system towards the Eastern Europe. The project will significantly increase the level of the diversification of gas supplies for Ukraine (access to the new sources of natural gas, including the LNG); level of integration of regional gas markets and establishing a transmission corridor, which will support integration of the regional gas market and enhancement of energy solidarity among countries of the European Union and the Energy Community.
The integration of Polish and Ukrainian transmission systems is a part of the North – South Gas Corridor allowing for transmission of gas from the LNG Terminal in Świnoujście through the countries of the CEE via cross-border interconnections. The main objective is to establish a flexible transmission infrastructure within the CEE, which will allow for connecting western gas markets and global LNG market with the market of the CEE. Such a scale effect should positively influence the competition and attractiveness of the region in the perspective of market participants.
The signed Agreement regulates the cooperation of both Operators during the engineering phase and – depending on the investment decision – during future implementation phase. The Agreement provides also the possibility to conduct the Open Season procedure, which aims at commercial and business justification of the expansion of the national gas transmission system, and primarily confirmation of the actual interest in the market. On the basis of the Open Season results the final decision on the investment will be taken by Operators, in agreement with national regulators and in accordance with legislation of Poland and Ukraine.
Both Operators pays attention to ensure that the Gas Interconnection Poland – Ukraine Project will be implemented and they continue dialogue with the various project stakeholders. On 22nd February 2016 the project promoters applied to the Energy Community for a status of the “Project of Mutual Interest” (PMI). Following this request, on 14th October 2016, the Energy Community recommended the Gas Interconnection Poland – Ukraine to be granted with the PMI status.