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Poland’s PGNiG expands gas storage by 25% to boost energy security

PGNiG Group announced to expand its Underground Gas Storage Facility in Wierzchowice by 800 million cubic metres (mcm) as European energy market turmoil deepens. The project will increase Poland’s overall gas storage capacity by 25 per cent to 4 billion cubic metres (bcm).

“The project to expand our gas storage site in Wierzchowice will significantly improve Poland’s energy security,” said Iwona Waksmundzka-Olejniczak, the CEO of PGNiG adding that it will grant more resilience in face of an energy crisis.

“By investing in storage infrastructure, we are strengthening the potential of the Polish gas market,” she underlined adding that this will be also a priority of the multi-utility energy concern that will be established after the merger of PKN ORLEN, Grupa LOTOS and the PGNiG Group.

The expansion of the Wierzchowice gas storage in Lower Silesia will increase its working capacity from the current 1.3 bcm to 2.1 bcm. This will ensure greater flexibility to accommodate a sudden spike in gas demand. The daily injection capacity will increase by a third, from the current 14.4 mcm to 19.2 mcm. The withdrawal capacity will rise even more, by 66 per cent – from 14.4 mcm to 24 mcm per day.

Consequently, Wierzchowice will account for nearly half of the country’s overall storage capacity, which will reach 4.03 bcm after the expansion. The total cost of the project, which is scheduled to be completed within 30 months, will be just over 80 million euros.

“Given the construction time and cost, gas storage infrastructure needs a long-term strategy,” noted Ms Waksmundzka-Olejniczak highlighting that over the past decade, PGNiG has increased the domestic storage capacity by 1.5 bcm.

“However, in order for these investments to bring tangible benefits in terms of supply security, adequate gas stocks must be built up. So we are equally determined to fill our storage sites to capacity ahead of the heating season,” underlined the CEO of PGNiG reminding us that with regard to the geopolitical turmoil, this year PGNiG started the injection process earlier and today the storage facilities are almost full.

Natural gas supplies about 18 per cent of Poland’s energy mix in 2020. The country’s existing gas storage facilities are 97 per cent full, but the current storage capacity of 3.2 bcm is relatively small compared to the annual gas consumption of about 20 bcm.

Poland was the first country – together with Bulgaria – to be cut off from Russian gas in April. Warsaw had been continuously taking steps to diversify supplies even before Europe decided to phase-out dependence on Russian fossil fuels as a response to Russian aggression in Ukraine. Poland’s gas market balance is supported by a liquefied natural gas (LNG) terminal running at full capacity and in May, the GIPL pipeline linking Poland and Lithuania was partially commissioned, granting the country another potential supply source, including additional access to LNG.

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