Page 12 - EurOil Week 50 2021

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PGNiG readies North Sea gas Petrom — which holds the other 50% stake operations is held by the lack of formal
In a statement made last week, OMV
clearance from German authorities.
field for Baltic Pipe in Neptun deep and will become the project risk of the opening of this pipeline and how
“I drew the Chancellor’s attention to the
operator replacing ExxonMobil — said that
Warsaw-listed state-controlled Polish oil and the investment would be unblocked no the scenario against which we warned is
gas company PGNiG has started work on sooner than 2023 unless Romania’s new ruling becoming reality,” Morawiecki told a press
readying the King Lear natural gas field in the coalition amends the Offshore Law by the end conference.
Norwegian section of the North Sea, looking of 2021. “[Nord Stream 2] puts in a difficult
to secure future supplies for the Baltic Pipe, a OMV Petrom estimates that it will invest situation not only Ukraine but also Poland
gas link from Norway via Denmark to Poland. up to €2bn in this project that will start and other eastern European countries,”
“Once operational, King Lear may increase generating resources in 2026-2027 depending Morawiecki also said.
PGNiG Group’s natural gas production on on the time when the Offshore Law is Earlier, Poland’s Foreign Minister Zbigniew
the Norwegian Continental Shelf by [up to] amended by the local authorities. Romgaz is Rau told Baerbock that Nord Stream
330mn cubic metres (cm) a year,” PGNiG said expected to contribute the same amount. was harmful to “our mutual relations, for
in a statement. The field is also expected to Romanian brokerage firm Swiss Capital European solidarity, for allied relations in
yield 258,000 metric tonnes of oil annually at revised its price target for the shares of Europe, for Germany’s credibility, and finally
peak output. Romgaz to RON46.5, to be revised upward for the security and territorial integrity of
PGNiG hopes that the field will help by RON9.7 upon the completion of the Ukraine”.
maintain the company’s natural gas ExxonMobil deal. The RON 9.7 revision is Nord Stream 2 is at the centre of renewed
production in Norway to “secure a stable and consistent with a rise of RON3.74bn (€0.75bn) tension between Moscow and Kyiv. Russia has
diversified gas portfolio which will be supplied in terms of market capitalisation. been amassing troops along Ukraine’s eastern
to Poland through the Baltic Pipe pipeline”. Romgaz has a market capitalisation of border, with Western media running stories
The EU-backed Baltic Pipe will deliver RON14.3bn (€2.8bn).. based on leaks from intelligence services that
10bn cm per year of gas to Poland at full an invasion could begin as soon as in January
capacity, helping the country to wean itself or February.
off Russian gas and replace more coal-fired Poland warns Nord Stream 2 That has the CEE’s Nato member states on
power generation with somewhat cleaner gas- high alert, which was hardly alleviated by the
burning power plants. is risk to European solidarity Nato’s biggest military power, the US, talking
Poland’s long-term supply contract with to Moscow on ways to de-escalate tension.
Russia’s Gazprom expires at the end of 2022. and a threat to Ukraine The US President Joe Biden said last week
Poland has long said it is not going to renew that if Moscow invaded, Nord Stream 2 would
it. The Gazprom contract currently covers The Nord Stream 2 gas pipeline linking Russia never become operational.
roughly two-thirds of Polish gas demand, directly to Germany via the Baltic Sea is a Biden’s words attracted criticism for
estimated at some 16bcm. project that is harmful to Europe and a direct allowing the Russian President Vladimir
Other than the Baltic Pipe, Poland is threat to peace in Ukraine, top Polish officials Putin to get the pipeline working simply by
also buying gas via an LNG terminal in told their German counterparts over the not doing anything – with the whole military
Swinoujscie on top of a few billion cubic weekend. posture now considered a way to achieve that
metres of domestic production. New German Chancellor Olaf Scholz goal.
Production from King Lear is expected to visited Warsaw on December 12. Foreign The US administration said later that
start at the end of 2027, PGNiG said. Minister Annalena Baerbock arrived two no backstage or official talks with Russia
According to the Norwegian Petroleum days earlier. Both visits were a part of the new would take place without consulting the CEE
Directorate, King Lear’s proven recoverable German government’s inaugural diplomatic member states of the EU – which were all in
reserves are 11bn cm of gas and 9.6mn cm of push, which also included Paris and Brussels. Russia’s sphere of influence prior to 1989 –
oil. Scholz and Baerbock came to Poland and Ukraine, a part of the Moscow-led Soviet
The King Lear field spreads over two North amidst no shortage of flashpoints between Union until 1991.
Sea licenses, which PGNiG acquired in 2019. Warsaw and Berlin. Warsaw’s radical Both Scholz and Baerbock dodged directly
The company’s subsidiary PGNiG Upstream rightwing Law and Justice (PiS) government addressing the Nord Stream issue at their
Norway holds a 22.2% stake in both. The keeps playing the German card to rally the respective press conferences. They talked
remaining shares are held by the operator, the electorate at home. instead about Ukraine’s territorial integrity –
Norwegian company Aker BP. PiS’ leader Jaroslaw Kaczynski reportedly long compromised by Russia after taking over
said recently that the new German Crimea in 2014 – as well as cooperation in
government wanted to build “the Fourth handling the Belarusian strongman Alexander
Romgaz goes ahead with Reich” to dominate the EU. PiS has also Lukashenka and Germany’s “guilt and
responsibility” for the war and occupation of
repeatedly raised the issue of Germany’s
$1bn takeover of 50% of paying for the destruction of Poland during Poland.
World War 2.

Neptun Deep issue than Warsaw’s ritual poking of Berlin’s
Nord Stream 2 is, however, a bigger
The shareholders of Romanian state- wartime guilt. Gazprom’s gas exports to
controlled natural gas company Romgaz Poland and other EU members of central Serbia up 85.8% y/y in 11M21
approved the management’s plan to pay Europe are concerned that the pipeline will
just over $1bn for a 50% stake in the Black enable Moscow to manipulate gas supplies for Gas exports to Serbia in the first eleven
Sea Neptun Deep offshore gas project from political purposes, especially to sow chaos in months of this year by Russia’s Gazprom were
ExxonMobil on December 10, according to Ukraine. 85.8% higher than in the same period of the
a note to investors. The shareholders also Nord Stream 2 is technically ready to start previous year, the company said.
approved a €325mn loan to cover part of the pumping 55bn cubic metres of gas annually Gazprom produced 467.6bn cubic metres
price. to Germany but the start of the pipeline’s (bcm) of gas in January-November of 2021,

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