Ukraine to Import More Gas From Poland, Sourced From US LNG

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(Bloomberg) — Ukraine will increase its gas purchases from Poland, sourced from imports of US liquefied natural gas, after Russian attacks wiped out almost 60% of its domestic production. 

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Kyiv-based Naftogaz Group agreed with Orlen SA to buy at least an additional 300 million cubic meters of gas for winter period, Chief Executive Officer Sergii Koretskyi said in an emailed statement. Seaborne cargoes of the fuel will arrive in Poland or Lithuania from the US as a super-chilled liquid, then be shipped to Ukraine in its gaseous form via the country’s pipeline network.

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“This agreement allows us to achieve two important goals at once: First, ensuring additional volumes of imported gas that are critically needed during the heating season due to Russian attacks on Ukraine’s civilian energy infrastructure,” Koretskyi said after signing the deal with Orlen on Friday at the P-TEC conference in Athens, Greece. “Second, our partners, together with Poland’s export credit agency KUKE, are providing us with a credit facility for post-payment of delivered volumes, which helps to cover the current liquidity gap.” 

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Poland’s Orlen has so far this year sent more than 600 million cubic meters of US LNG to Ukraine via an interconnector pipeline. It’s scheduled to ship another 300 million in the first quarter and will be able to deliver a record volume of more than 1 billion cubic meters of American gas next year via the same route.

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“The agreement will allow for the import of a significant volume of gas from the United States to Ukraine and opens the door to further initiatives of this type, which may aim to support other countries in central and eastern Europe,” said Poland’s Energy Minister Milosz Motyka.

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Russian strikes on gas production facilities operated by Naftogaz and private energy company DTEK have forced Kyiv to seek at least 1.9 billion euros ($2.2 billion) to pay for additional gas imports through heating season, which started earlier this month and normally ends in the end of March. Ukraine’s gas infrastructure — able to meet domestic demand before Russia’s full-scale invasion in 2022 — has come under increasingly intense missile and drone strikes since the beginning of this year.

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As part of President Donald Trump’s push for international energy dominance, the US is seeking to sell more LNG to European markets. The European Union has already halted most purchases of Russian gas via pipeline, and is preparing to phase out imports of the country’s LNG from 2027. 

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