Poland and Russia finalise major gas deal

The Polish government has finalised the smallprint of a major new gas deal with Russia, paving the way for an official signature in the coming days.

Polish ministers approved the contract on Tuesday evening (26 October), with Polish deputy prime minister Waldemar Pawlak and his Russian counterpart, Igor Sechin, expected to ink paper in Moscow before the weekend.

The agreement is to see Russia's Gazprom sell 10.3 billion cubic metres (bcm) a year of gas to Polish state-owned firm PGNiG until 2022 using the Yamal pipeline, which crosses Belarus. A separate Polish company, the state-owned Gaz-System, is to operate the Polish section of the pipeline.

The European Commission has told the Bloomberg news agency that it will publish its opinion on the contract in the next 48 hours.

Brussels had earlier warned that the pipeline must be managed by an independent entity and must be open for use by third parties in order to conform with EU law. An EU official has reportedly taken part as an observer in the Polish-Russian talks over the past month.

Poland consumes about 13 to 14 bcm of gas a year and imports two-thirds of the volume from Russia. PGNiG aims to build two new gas-fired power plants by 2015.

Polish critics of the new Gazprom deal have said it will deepen the country's energy dependency on Russia, its Communist-era foe.

The energy contract comes amid a warming-up of relations between Moscow and Warsaw under the centre-right government of Polish leader Donald Tusk.

Speaking ahead of a visit by the Russian foreign minister to Poland on 28 October, Russian foreign ministry spokesman Andrei Nesterenko told Russian news agency RIA Novosti on Tuesday: "We believe it is fundamentally important to consolidate the existing positive trends, to 'reset' Russian-Polish co-operation in all fields."

The Gazprom deal could reduce the attractiveness of two other Polish projects designed to diversify gas supplies.

US firm ConocoPhillips is currently drilling for shale gas near Gdansk, with Poland said to be sitting on as much as 1.36 trillion bcm of the alternative resource.

The Polish authorities are also constructing a new liquid gas (LNG) terminal at the Baltic Sea port of Swinoujscie.

Polish news agency Forsal earlier this month reported that Gazprom's Brussels-based lobby firm, GPlus, is trying to discourage the EU commission from giving money to the project on environmental grounds.

[Source: By Andrew Rettman, Eubserver, Brussels, 27Oct10]

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