Poland set to export U.S. LNG to Ukraine to reduce dependency on Russia

The United States will work with Poland and Ukraine to reduce their dependence on Russian gas, media reported after a meeting between U.S. Energy Secretary Rick Perry and Polish and Ukrainian officials.

“We’re helping Poland to reduce its dependence on Russian gas,” Perry is reported by Reuters as saying.

“We will take every effort to diversify gas supplies to Ukraine, which is now completely dependent on Russian deliveries,” said Piotr Naimski, in charge of Poland’s energy infrastructure.

Poland is less dependent on Russian gas than Ukraine, and is already importing U.S. LNG. The country's main gas firm PGNiG has signed a 20-year agreement with U.S. Venture Global LNG, under which the Polish energy firm will receive 2 million tons of U.S. liquefied natural gas (LNG) every year beginning in 2022.

Poland pays around 25% less for U.S. LNG than it does for Russian gas.

Naimski said Poland was going to increase its own exports of natural gas to Ukraine, from the current 1.5 billion cubic meters a year to 6 billion cubic meters beginning in two years. The increase will apparently come from the substantial boost in the imports of U.S. LNG.

Currently a third of Russian gas sent to Europe passes through Ukraine and in addition to the transit fees the country receives, it also receives gas for its own consumption.

However, Ukraine’s gas delivery contract with Gazprom will expire next January after a prolonged legal battle between the Russian giant and its smaller Ukrainian counterpart, Naftogaz, which the latter won, leading to fears that Russia will not renew the agreement.

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