Naftogaz Group and ORLEN SA have signed a memorandum of cooperation in the liquefied natural gas (LNG) sector to help Ukraine diversify its energy supply.
The first act of the agreement will be the sale by ORLEN of about 100 million cubic meters (3.53 billion cubic feet) of gas derived from the regasification of an LNG cargo. The cargo will be delivered to a terminal in Klaipėda, Lithuania. The gas will then be shipped via the GIPL pipeline connecting Lithuania and Poland, and further through Poland to the interconnector on the Ukrainian border in Drozdowicze, where it will be received by Naftogaz.
“The agreement is a framework arrangement aimed at strengthening cooperation to enhance Ukraine’s energy security through the diversification of gas supply sources and routes to the country”, ORLEN SA, majority owned by the Polish state, said in an online statement.
Robert Soszyński, vice president of ORLEN’s management board for operations, commented, “Our relationship will be based on commercial terms, but securing an additional source of gas is vital for Ukraine also from the point of view of its security”.
“It is through diversification that ORLEN ensures stable and competitive gas supplies for Polish consumers and can be a reliable partner for foreign counterparties”, Soszyński added.
Roman Chumak, chairman of Ukraine’s state-owned Naftogaz, said, “Ukraine has a robust gas transportation system and Europe’s largest underground storage facilities, offering unique opportunities for LNG market expansion”.
“Partnering with ORLEN strengthens energy security, diversifies supply routes, and accelerates Ukraine’s integration into the European gas market”, Chumak added.
Recently the European Commission pledged support to further integrate Ukraine into the European Union gas market and fully integrate the country into the regional power market.
The integration assistance is part of a new package of EU aid for Ukraine, announced February 24, that also involved financial aid for the country’s gas purchases and investment in Ukraine’s renewable energy build-out. The Commission announced the package February 24 at the International Summit on the Support of Ukraine, held in Kyiv on the third anniversary of Russia’s invasion.
“The package will facilitate electricity market integration with the EU by spring 2027, together with Moldova, as well as further integration in the EU gas sector”, the Commission said in an online statement.
“This will be possible if Ukraine speeds up the implementation of existing commitments under the Ukraine Plan and the Energy Community in relation to legal, regulatory and public service obligation frameworks”, the Commission added.
The power systems of Moldova and Ukraine, which are both seeking EU membership, have been synchronized with the European continental network since March 2022 in response to Russia’s invasion a month earlier.
Meanwhile the aid for gas purchases will come mainly from the Ukraine Facility. Earmarked with up to EUR 50 billion ($54.33 billion) for 2024-27, the facility is a stable EU funding platform to support Ukraine amid the war. The facility
The gas procurement assistance “will result in ample gas reserves to ensure security of supply, benefiting both Ukraine and the wider region”, the Commission said.
Von der Leyen told the summit, “[W]e will seize the full potential of Ukraine’s vast gas storages, of which 80 percent are located close to EU Member States”.
To contact the author, email [email protected]
What do you think? We’d love to hear from you, join the conversation on the
Rigzone Energy Network.
The Rigzone Energy Network is a new social experience created for you and all energy professionals to Speak Up about our industry, share knowledge, connect with peers and industry insiders and engage in a professional community that will empower your career in energy.
www.rigzone.com (Article Sourced Website)
#Ukrainian #Polish #Energy #Companies #Ink #LNG #Cooperation #Deal