Slovakia’s ZSE, Poland’s Orlen ink LNG supply deal

Slovakia’s gas and power firm SZE has signed a deal with Poland’s energy firm and LNG importer Orlen to buy liquefied natural gas from the latter. These LNG supplies will be delivered mainly from the US to the FSRU-based terminal in Lithuania’s Klaipeda.

The group, which has two subsidiaries ZSE Energia and Zapadoslovenska distribucna, revealed the supply deal in a statement issued on Monday.

ZSE said the contracted volumes will cover about 30 percent of ZSE Energia’s demand during the year, but it did not provide further details.

The company is the second largest gas supplier in Slovakia.

ZSE said the deliveries to the 170,000-cbm FSRU Independence in Klaipeda will take place during 2025.

The company added that regasified LNG from Klalipeda will be delivered to Slovakia via Poland.

The gas supplies will be transported via the Gas Interconnection Poland-Lithuania (GIPL) to the Polish gas system and then sent to Slovakia via the Vyrava interconnector.

Diversifying supplies

Orlen said in a separate statement the contract is an example of growing cooperation between companies from Central and Eastern Europe aimed at diversifying supplies and strengthening gas security in the region.

This will be the first time that a Slovak company will import natural gas from the north, according to Orlen.

Orlen said the gas price under the contract will be set in a commercial manner.

Orlen signed the deal via its unit PGNiG. In November 2022, PKN Orlen completed its merger with Poland’s dominant gas firm, PGNiG, which is in charge for all of the LNG supplies coming to the Swinoujscie facility in Poland and to the Klaipeda LNG terminal.

Since May 2022, Orlen has been using the Klaipeda terminal where it has received more than 10 shipments.

Last month, the FSRU-based terminal operated by KN Energies restarted operations after spending some time in a Danish yard for maintenance works.

Orlen’s LNG purchases

Orlen’s PGNiG mainly receives contracted volumes from the US and Qatar, but also from the spot market.

The company has contracts with Cheniere and Venture Global LNG. However, the latter has still not declared commercial operations at its Calcasieu Pass facility.

Orlen previously said that 41 ships arrived in 2023 from the US to Swinoujscie as part of long-term and spot purchases.

Qatar was the second-largest supplier with 19 shipments, while one shipment each arrived from Trinidad and Tobago and Equatorial Guinea.

In 2022, 36 deliveries came from the US, and 18 ships arrived from Qatar.

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