The final phase of the Open Season 2017 procedure ended up with a positive result proving the demand from the market for capacity to be delivered by the Baltic Pipe Project. The participants have confirmed their interest shown in the first phase, by submitting binding bids and committing themselves to 15-years contracts for gas transmission from the North Sea through Denmark to Poland.
Among the participants of the procedure was Polskie Górnictwo Naftowe i Gazownictwo SA, (PGNiG) which has submitted app. 2 bln EUR binding offer to book capacity on the country’s planned gas link to Norway.
“Based on the positive result of the Open Season 2017, the gas operators will continue their project activities in order to be able to deliver the first gas by 2022, if a positive investment decision is taken in 2018,” GAZ-SYSTEM said in the statement.
The economic tests is the next step that will be conducted pursuant to requirements of the national energy regulatory authorities in Poland and Denmark, ERO and DERA respectively. The deadline for the completion of the economic tests is 30th of November 2017 and the result shall be announced by GAZ-SYSTEM and Energinet. The conclusion of the Open Season 2017 Capacity Agreements requires a positive outcome of the economic test for each Transmission System Operators and depends on some other conditions set forth in the Open Season 2017 Rules.
A final investment decision in 2018 depends i.a. on the conditions set forth in the Capacity Agreements. In Denmark, the investment requires the approval of the Minister for Energy, Utilities and Climate. The final capacity agreements are expected to be signed by the end of January 2018.
The Baltic Pipe is a major gas infrastructure project that aims at creating a new supply corridor for gas in the European gas market; the projected pipeline makes possible for shippers to flow gas directly from Norway to Denmark, Poland and other neighbouring markets. The project is pursued by Danish and Polish gas TSOs - Energinet and GAZ-SYSTEM S.A.
The Baltic Pipe will be approximately 600-800 kilometres long and is projected to start its gas transmission services by the end of 2022. The new pipeline would expand Europe’s gas transmission capacity by up to 10 billion cubic metres of gas per year.
The EU has included the Baltic Pipe on its list of key infrastructure projects – Projects of common interest (PCI).
Source: Energinet, GAZ-SYSTEM and Reuters