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Lithuania Advances Polish Gas Link After EU Prioritizes Project

Oct. 30 (Bloomberg) -- Lithuania plans to move ahead with a 558 million-euro ($767 million) project linking the Baltic natural gas transmission grid with the rest of Europe via Poland after the European Union gave it priority status.

The EU included the link in the list of common-interest energy projects published earlier this month, which means the pipeline is eligible for as much as 75 percent financing by the 28-nation bloc, Lithuania’s Energy Ministry in the capital Vilnius said today in an e-mailed statement. Progress in talks with Poland also means territorial planning can now start, the ministry said.

The new Polish connector, along with planned liquefied natural gas terminals in the Baltic region, will help Lithuania, Latvia and Estonia escape current total dependence on Russia’s Gazprom OAO for natural gas supplies. It’s also part of EU plans for a north-south gas corridor across central and eastern Europe linking the Baltic, Black, Adriatic and Aegean Seas.

“Our gas link with Poland is strategically important for the entire region,” Lithuanian Energy Minister Jaroslav Neverovic said in the statement. “This project will contribute significantly to realizing one of the EU’s main energy policy goals - completing the internal market.”

Lithuanian and Polish gas transmission system operators, Amber Grid AB and Gaz-System SA, are managing the project to build 534 kilometers (330 miles) of pipeline between Jauniunai in Lithuania and Rembelszczyzna in Poland, the ministry said.

The connection, known as GIPL, is now scheduled to start operations in 2018, Saulius Bilys, Amber Grid’s chief executive officer, said yesterday at a conference in Vilnius. Its initial capacity to transport 2.4 billion cubic meters of gas a year can be increased later to 4.1 billion cubic meters, Bilys said.

To contact the reporter on this story: Bryan Bradley in Vilnius at bbradley13@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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