Poland-Lithuania Interconnector Advances

On Aug. 19, the natural gas transmission system operators of Poland (GAZ-SYSTEM S.A.) and Lithuania (AB Amber Grid) submitted joint applications to the European Union for funds to plan, design, and construct the Gas Interconnection Poland-Lithuania (GIPL). The 550 km (343 mile) pipeline will run from Warsaw to Vilnius (approximately) and will have an initial capacity of 2.3 bcm/year (which can be expanded to 4.5 bcm/year if demand warrants).

The interconnector has a total estimated price tag of €558 million ($742 million). If the applications are approved, the EU would cover 50 percent of the planning and design expenses and 75 percent of the construction costs. The significance of the GIPL project cannot be overstated:

The Baltic states—Lithuania, Latvia, and Estonia—are considered “energy islands,” because they are not connected to the EU’s natural gas distribution system. GIPL (and existing interconnectors between the nations themselves) will change that situation and ensure diversity of supply sources for the region. (Currently, all three countries are 100 percent dependent upon natural gas supplied by Gazprom, the Russian state-controlled company.)