Industry Trend Analysis - Additional LNG Capacity Drives Supply Flexibility - MAY 2017

BMI View: A proposed second Polish LNG terminal would boost flexibility in the domestic and regional gas market, while support efforts to diversif y away from Russian pipeline gas through increasing Poland's leverage in future Russian gas contract negotiations .

The realisation of a second import terminal in Poland, slated to be a floating storage and regasification unit (FSRU), would likely be a quicker and more cost-effective strategy than the proposed Baltic Pipe pipeline running from Norway to Poland via Denmark.

State-owned grid operator Gaz-System is currently co-ordinating a feasibility study regarding a proposed FSRU in the Gdansk Bay in north-east Poland. The FSRU would represent the second LNG import terminal in the country following the initiation of LNG imports at the Swinoujscie terminal in late 2015. The proposed terminal would nearly double existing LNG import capacity from 5.0bcm to 8.1bcm and be ready for first imports in 2021. Importantly, Gaz-System views the Gdansk FSRU as an alternative to the Baltic Pipe project; planned to bring Norwegian gas to Poland.

Russia Dominates Supply
Poland Gas Imports By Country 2015 (% of total imports)
Source: TradeMap, BMI

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