Gas Deal Polish Minister’s Downfall
Published: April 30, 2013 (Issue # 1757)
On Apr. 24, Wlodzimierz Karpinski was sworn in as Poland’s newest treasury minister following the firing of the previous minister, Karpinski Budzanowski, on Apr. 19.
Polish Prime Minister Donald Tusk relieved Budzanowski of his duties after citing a failure to adequately supervise the nation’s state-owned energy company PGNiG in the signing of a preliminary gas pipeline agreement in St. Petersburg earlier in April.
According to the Warsaw Business Journal, Karpinski has vowed to make changes in the PGNiG management board over the next three months.
Budzanowski was fired two weeks after a deal in which a PGNiG subsidiary, Europol Gaz, inked an agreement with Gazprom regarding a proposed gas pipeline.
The proposed pipeline, called the Yamal-Europe II, would have 15 bcm of yearly throughput capacity and would serve as an extension of the existing Yamal-Europe pipeline that currently transports Russian gas through Belarusian and Polish territory. The section of the pipeline through Poland is owned by Europol Gaz.
After being shelved in favor of Nord Stream years ago, the Yamal-Europe II project was revived by President Vladimir Putin during a meeting on Apr. 3 in which he instructed Gazprom CEO Alexei Miller to resume work on it.
Gazprom wasted no time and only two days later, a “memorandum of understanding” between Gazprom and Europol Gaz had been signed.
Yamal-Europe II, like the already completed Nord Stream, and the under-construction South Stream, has the property of being an alternative transit route for Russian gas to Europe that bypasses the territory of Ukraine. Ukraine has been a troublesome transit country for Russia, having been involved in price disputes with Russia that resulted in the disruption of gas flow in 2006 and again in 2009.
“The gas pipeline route will run through Poland and our Polish partners will take an active part in engineering and construction works,” reported Gazprom on its website following the signing in St. Petersburg.
The reaction from the Polish side showed a different story.
Budzanowski, who was responsible for overseeing state-run companies including PGNiG, was initially unaware that the signing had taken place.
Once informed of the situation, Budzanowki stressed that only Polish state-owned companies acting in accordance with the Polish government could build such strategic pipelines.
Even though Europol Gaz is a subsidiary of state-owned PGNiG, it is also a subsidiary of Gazprom, which holds a 48% stake in Europol Gaz. The prime minister said simply of Europol Gaz, “it is not a Polish company.”
Like many other nations dependent on Russian gas, Poland is trying to decrease its imports of Russian energy, and in public discourse, Gazprom has become a contentious name. As such, representatives of PGNiG were keen to downplay this agreement’s significance.
“The signed document contains research and analyses only and does not provide for any binding business commitments, and certainly does not represent a final decision to construct any gas pipeline in the territory of Poland,” read a PGNiG press release following the deal.