To secure LPG supplies in winter, the most important thing will be the optimal use of railways, says Bartosz Kwiatkowski, director of the Polish Liquefied Gas Organization. He added that despite the embargo on LPG from Russia, which will come into force on December 20, there should be no shortage of this fuel in Poland, and companies are intensively preparing for the new regulations.
December 20 this year a full embargo on LPG supplies from Russia comes into force. 2024 was a transition period for companies to prepare for this moment.
According to the estimates of the Polish Liquefied Gas Organization (POGP), in November this year approx. 25 percent LPG imports still came from Russia. Until September this year. Gas worth PLN 1.76 billion was imported to Poland from Russia. As reported by POGP in the first half of this year the share of Russian LPG in imports to Poland increased from 50 to 53 percent, and then in August this year. dropped to 37.5 percent
In 2022 Poland was the largest importer of LPG from Russia among European Union countries.
Import and export of LPG in the first half of 2024POGP
Companies declare their readiness
– In 2025, a certain pool of Russian gas will remain legally on the Polish market, because the high-purity butane fraction has not been covered by the embargo – pointed out the director general of the Polish Liquefied Gas Organization, Bartosz Kwiatkowski. He added that during the first three quarters of this year approx. 8 percent LPG imports from Russia (PLN 160 million) were imported under this code. Kwiatkowski said that, nevertheless, more companies declare their readiness for sanctions. – Next year, LPG will reach Poland mainly from Sweden, Norway, Germany, Great Britain and the USA. In the coming years, more fuel from Algeria and the Persian Gulf may also appear on the European market, Kwiatkowski pointed out.
In his opinion, companies are intensively preparing to change supply directions. – One of the largest players has rented a gas terminal in Wilhelmshaven (Unimot – ed.), another has taken over and is reactivating the transhipment infrastructure frozen under the sanctions act in 2022, others are conducting investment projects in the expansion of sea and railway terminals – said the director of POGP. However, he noted that these projects would not be completed by the end of the year.
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Concerns about rail transport
– There are concerns about railway capacity, but at one of the parliamentary subcommittees, a representative of the Ministry of Infrastructure assured that Polish railways will be able to coordinate activities with German railways and handle increased train traffic – said Kwiatkowski. – In the perspective of the next winter, optimal use of railway transport capacity is the most important – he said. He pointed out that in the longer term this will be an expansion of existing terminals. Kwiatkowski emphasized that “in this case, the industry counts on good cooperation in issuing environmental decisions and efficient, timely consideration of applications by the competent authorities.” He recalled that, in particular, Orlen assured that it was able to increase domestic production if there was a risk regarding the continuity of gas supplies to customers for heating purposes.
According to the latest available POGP data, the largest amount of liquefied gas arrives in Poland by rail – in August it was 53%.
35 percent LPG arrived at domestic terminals by sea, which – according to POGP – reflects an increase in supplies from Norway and other Western European countries, and 11 percent crossed the border in road tankers.
Will the embargo affect prices at gas stations?
When asked about the future of LPG prices after the embargo, Kwiatkowski said that if gasoline prices remained at their current level, autogas would remain the cheapest fuel on the market, by 45 percent. cheaper than motor gasoline. In January this year autogas cost less than PLN 2.90, currently the average price is around PLN 3.15. – The historically highest levels of LPG prices were reached in March 2022, immediately after the full-scale Russian invasion of Ukraine – then you had to pay PLN 3.80 per liter – he recalled. – We do not expect prices to approach this level next winter – he said. The POGP director emphasized that it is worth drawing conclusions from the implementation of sanctions imposed on Russian crude oil. He pointed out that in 2023 and 2024, Russian producers increased oil exports to India and Turkey, and oil processing products from Turkish refineries went to Europe. According to Kwiatkowski, it cannot be ruled out that a similar process will also take place in the case of LPG. – Transparency on the part of customs services is important in this case, including precise definition of what documents prove compliance of the imported fuel with the rules set out in the sanctions regulation – he emphasized.
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