Warsaw Opens Taps to More Russian Gas

bloombergAlexander Ananenkov
WARSAW -- The Yamal pipeline pumping Russian gas to the European Union, partly over Polish soil, boosted capacity by 27 percent on Monday and will run full-throttle by the end of the year, its operator, Europol Gaz, said.

Europol Gaz, owned by Russian giant Gazprom, Polish gas monopolist PGNiG and a partner, said two pumping stations were opened on the 680-kilometer Polish leg of the line, boosting capacity to 29 billion cubic meters per year.

"At the end of the year, once we build the last pumping station, the Yamal line will reach its capacity of about 34 billion cubic meters," Michal Kwiatkowski, head of Europol Gaz, told a news conference.

Poland, dependent on Russian gas supplies and a key transit country on route to Germany, has been pushing to expand the pipeline running from Russia's northern Yamal peninsula.

The existing Yamal line is only half of a double pipeline originally designed in the 1990s.

Plans to start work on the second line are in jeopardy after Gazprom signed a deal to invest in another pipeline to run under the Baltic Sea.

Gazprom deputy chief Alexander Ananenkov, also present at the news conference, sought to allay Polish fears that the Baltic line, which bypasses Poland and other EU newcomers with cool relations with the Kremlin, may allow Moscow to shut down the Yamal route.

"This is not an alternative to the already existing gas transit route. ... I know of no companies or states that could endanger Polish energy security," he said in response to a question.

Ananenkov said, however, that Gazprom was in no hurry to build the second Yamal line, which would boost capacity to 67 bcm -- compared with about 55 bcm planned for the Baltic route.

"We have to get the first, quite expensive line to run at full capacity, and only later we will evaluate whether a second line is needed," he said.

Europol Gaz said the first Polish line between Belarus and Germany would cost about $1.5 billion, but synergies could cut the cost of the second line if it is given the green light.

"The Baltic line project could delay the construction of the second Yamal line by several or even by a dozen years," PGNiG chief Marek Kossowski said.

But Kossowski said this might not necessarily be bad for Poland, if Warsaw mobilized EU support for alternative sources of natural gas, possibly from Iran or Turkmenistan.

Backed by Moscow and Berlin, Gazprom recently signed an agreement to build the Baltic line with German BASF.