Page 7 - FSUOGM Week 50 2019

FSUOGM PIPELINES & TRANSPORT FSUOGM
Estonia, Finland commission gas pipeline link
FINLAND
The pipeline gives Finland access to LNG imports from northern Europe.
FINLAND is set to break Russia’s monopoly over its gas supply, following the launch of a new pipeline from Estonia.
Balticconnector was formally commissioned at a ceremony on December 11 attended by Esto- nian, Finnish and EU officials. Construction wrapped up in November – a month ahead of schedule – and the pipeline is due to start com- mercial gas flows to Finland on January 1.
“With the Balticconnector, we are entering a new era of gas supply, opening up the Baltic and Finnish gas markets for new trade opportu- nities,” Klaus-Dieter Borchardt, a senior energy official at the European Commission, said in a statement.
Finland is among a dwindling number of European countries that still has no alternatives to Russian gas, and imported 2.6bn cubic metres from its eastern neighbour last year. Balticcon- nector, with a flow capacity of 2.7 bcm per year, could fully meet Finland’s gas needs.
Some of this gas would still come from Rus- sian entry points in the Baltics, at least initially. But Finland could also tap supplies from the 4 bcm per year Klaipeda LNG import terminal in Lithuania, as well as stored volumes at the Incukalns storage facility in Latvia. Once a pipe- line is completed between Lithuania and Poland in 2021, it will gain access to gas from sources further afield, including Poland’s 5 bcm per year
Swinousjcie LNG terminal
Russia remains Europe’s biggest gas supplier,
accounting for around a third of its needs. But its leverage over buyers has steadily eroded, thanks to EU efforts to establish a single gas market and more recently, a surge in global LNG supply.
Even if Finland decides to continue buying significant quantities of Russian gas, which is likely, having access to alternatives will help it secure a cheaper price. Balticconnector’s flow can also be reversed, allowing Estonia to import Russian gas via Finland in case of supply disruptions.
Over the years the EU has helped fund the construction of gas interconnectors between member states, in order to connect isolated grids and improve energy security. Balticconnector was no exception, with grants from the bloc’s Connecting Europe Facility (CEF) covering 75% of its $250mn cost. The rest of the finance came from its operators, Finland’s Baltic Connector and Estonia’s Elering.
EU support was crucial in pushing the project forward. Studies began as early as 2011, although a final investment decision (FID) was not taken until 2016. Construction then got underway two years later. Balticconnector comprises a 77-km offshore section between Inkoo in Finland and Paldiski in Estonia, as well as 76 km of onshore pipelines in both countries. ™
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