The Baltic Pipe Project

The Baltic Pipe is a strategic infrastructure project, with the goal of creating a new gas supply corridor on the European market. For the first time, it will be possible to transport gas from fields in Norway to the Danish and Polish markets, as well as to customers in neighbouring countries. At the same time, the Baltic Pipe project will enable the supply of gas from Poland to the the Danish and Swedish markets.

Diversification of supplies through direct access to deposits of natural gas will significantly improve energy security. The Baltic Pipe project will make a significant contribution to the creation of an internal European energy market. The project is aligned with the objectives of the European Union's energy policy, such as increased competition, integration of gas markets, improved security of supplies and effective implementation of sustainable development guidelines.

The Baltic Pipe project will also further the aims of the North-South Corridor concept and the Baltic Energy Market Interconnection Plan (BEMIP), important priorities for the European Union in the area of energy infrastructure development.

Project Promotors:

  

GAS TRANSMISSION OPERATOR GAZ-SYSTEM S.A.  
Gas transmission Operator in Poland

   

 ENERGINET 
 Gas transmission Operator in Denmark 
 

 

The main objectives of the Baltic Pipe project:

  • Integration of the Danish-Swedish and Polish gas markets through supply competition and bi-directional trade to ensure increased price convergence.
  • Strengthening the security of supplies in the region by providing access to Norwegian natural gas deposits to Danish-Swedish and Polish markets, as well as other markets in Central and Eastern Europe.
  • Further improvement in the utilization of the existing infrastructure in Denmark to reduce tariffs and benefit users.
  • Increasing competitiveness in regional gas markets and facilitate price convergence, allowing new players to enter the market, and potentially increasing demand for gas in regions covered by the project;
  • Increasing technical reliability of gas supplies to customers by diversifying import routes
  • Linking of Baltic Pipe to the LNG terminal in Świnoujście, potentially giving Scandinavian countries access to the global liquefied natural gas (LNG) market.
     

 

Market research

In 2016, Gas Transmission Operator GAZ-SYSTEM S.A. and the Danish transmission system operator Energinet jointly developed  a feasibility study for a new interconnector between the two national markets through a offshore pipeline and the expansion of national transmission networks. In order to ensure full functionality of the planned connection, both operators analysed also  the tie-in linking the Danish and Norwegian transmission systems, and initiated the cooperation with the Norwegian transmission system operator, Gassco A/S.

The Feasibility Study was prepared by a consortium consisting of Rambøll Danmark A/S and BSiPG GAZOPROJEKT S.A., together with a subcontractor, Ernst & Young, under an agreement signed on March 15, 2016.  The Feasibility Study was co-financed by the European Commission under the CEF (Connecting Europe Facility) program.

The Feasibility Study included a detailed technical, financial and socio-economic analysis of the project, also in a regional perspective. In addition, a non-binding market study was conducted as part of the feasibility study, as an initial assessment of market interest in the project, along with an analysis of capacity, needed for a project profitability analysis.

A non-binding market study was conducted as part of the feasibility study, to provide an initial assessment of market interest in the Baltic Pipe project, along with an analysis of capacity, required to carry out a project profitability analysis.  The outcome of the study was positive and led to an assessment of the Baltic Pipe capacity of up to 10 billion m3 per year to Poland and up to 3 billion m3 per year to Denmark and Sweden.

 

The Baltic Pipe project, defined on the basis of the feasibility study, consists of five key components:

  • A gas pipeline from the Norwegian system in the North Sea to the Danish tie-in
  • Expansion of existing capacity in the Danish land-based transmission system
  • A compressor station in Zealand, Denmark
  • A submarine pipeline from Denmark to Poland, together with a terminal
  • Expansion of the Polish transmission system

 

The Open Season procedure

In the next stage, GAZ-SYSTEM and Energinet will invite market participants to take part in the Open Season procedure, which will enable the submission of bids for capacity of the new pipeline from Norway to Denmark and Poland.

The purpose of the procedure is for the operator to secure binding contracts to reserve capacity in the Baltic Pipe project before making the final investment decision. The Open Season procedure will be carried out in a transparent and non-discriminatory manner, in accordance with current EU regulations.

If market participants place orders for sufficiently large capacity, Energinet and GAZ-SYSTEM will undertake a fast track investment project, with the aim of making the gas pipeline operational on 1 October 2022.

Detailed information and documents related to the Binding Open Season Procedure will be available from 6 June 2017 on the following websites:
• GAZ-SYSTEM:http://en.gaz-system.pl/strefa-klienta/konsultacje-z-rynkiem/aktualne-konsultacje/open-season-baltic-pipe/
• Energinet: https://en.energinet.dk/OpenSeason2017

 

Project of Common Interest (PCI)

The Baltic Pipe project was included in the first list of Projects of Common Interest (PCI), drawn up by the European Commission in 2013, and in the subsequent list adopted by the European Commission on 18 November 2015, underlining its regional importance.
More information on the PCI Projects.

 

Financial support from the EU

Connecting Europe Facility (CEF) instrument
In 2015, the Baltic Pipe project received a subsidy of €0.4 million for initial work. These funds were used by GAZ-SYSTEM and Energinet.dk to prepare the required documentation, namely, the feasibility study.

Trans-European Networks for Energy Program (TEN-E)
Previously, pursuant to a decision of the European Commission, funding was approved for preparatory work (pre-investment) on the Baltic Pipe gas pipeline under the Trans-European Networks for Energy Program (TEN-E).

The first grant for this project, awarded to GAZ-SYSTEM in June 2009 and funded under the TEN-E 2008 program, was used to carry out pre-investment studies and to complete administrative procedures. The grant amounted to €3.19 million, with a maximum share in total funding of 50%.

In May 2010, the European Commission granted GAZ-SYSTEM additional funding under the TEN-E Program, following a request submitted in 2009. The scope of the grant included a geotechnical seabed survey, an environmental monitoring program, preparatory work for a gas quality survey and functional analysis of the gas terminal in Poland.

The total value of financial assistance received by GAZ-SYSTEM in the area of trans-European transport and energy networks for the Baltic Pipe project amounts to €4.31 million.

Read more about the co-financing from the Trans-European Networks-Energy (TEN-E).

The sole responsibility of this publication lies with the author. The European Union is not responsible for any use that may be made of the information contained therein.

Press Releases 

6.06.2017 Baltic Pipe: Launching of the binding Open Season Procedure

2.06.2017 - The Binding Open Season Procedure for the Baltic Pipe Project shall be launched early next week

7.12.2016 - Market consultation of the Open Season 2017 rules for the Baltic Pipe project

15.03.2016 - GAZ-SYSTEM S.A. and Energinet.dk are investigating a possible connection between the two transmission systems

16.07.2015 - EU financial support for the integration of Polish transmission system with the Czech Republic and Denmark

27.01.2015 - Consultations regarding the list of Projects of Common Interest

21.02.2014 - Projects of Common Interest (PCI) conducted by GAZ-SYSTEM S.A.: publication of an information brochure

15.10.2014 - Selected infrastructure projects of GAZ-SYSTEM S.A. were awarded the status of Projects of Common Interest (PCI)

 

 


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