Ukraine locks in US LNG through Poland deal: here are the details

In a recent development aimed at bolstering Ukraine’s energy security, state energy firm Naftogaz has inked a deal with Poland’s Orlen to procure 100 million cubic meters of liquefied natural gas (LNG) from the US. 

This strategic move highlights Ukraine’s efforts to diversify its energy sources and reduce dependence on traditional suppliers. 

The agreement comes at a time of heightened geopolitical tensions in the region and underscores the importance of energy partnerships in maintaining stability. 

The influx of US LNG is expected to enhance Ukraine’s energy resilience and contribute to its broader energy transition goals.

“The fuel will come from a shipment of US LNG. After regasification, the gas will be transported to the Polish-Ukrainian border,” Naftogaz said regarding the latest deal, adding the gas was due to arrive in April.

Roman Chumak, Acting Chairman of the Board at Naftogaz of Ukraine said:

Stable gas supplies remain our top priority. Cooperation with ORLEN expands Ukraine’s LNG import capacity and enhances energy security. We are diversifying supply sources to ensure a reliable and accessible gas supply, especially amid ongoing Russian attacks on our infrastructure.

Ukraine to use European terminals

Ukraine has the potential to significantly increase its natural gas imports from the United States this year, leveraging a network of existing import terminals located across Europe. 

These terminals, situated in Germany, Greece, Lithuania, and Poland, offer Ukraine access to LNG shipments from the US, according to media reports. 

This development comes amid ongoing geopolitical tensions and potential disruptions to Ukraine’s traditional gas supply routes. 

By utilising these European terminals, Ukraine can enhance its energy security and ensure a stable supply of natural gas for its domestic needs.

US emerges as major supplier

The US currently holds the position of the world’s largest exporter of LNG. 

This has been particularly crucial in the context of Russia’s invasion of Ukraine in 2022. 

This conflict led to a significant disruption in the energy landscape, with Russia, once a major supplier, cutting off much of its gas supply to Europe. 

As a result, the US stepped up to fill this void, playing a critical role in ensuring Europe’s energy security by supplying substantial amounts of LNG. 

This shift has not only highlighted the US’s capacity as a major player in the global energy market but has also underscored the geopolitical implications of energy supply and the importance of diversification in sourcing energy resources.

Ukraine diversifies after Russian attacks

Ukraine was forced to increase its gas imports due to Russian missile attacks on its gas production facilities. In February, following a series of attacks, Ukraine’s gas imports saw a nearly tenfold increase.

Additionally, in January, Ukraine had refused to renew a deal responsible for transiting Russian gas through pipelines to Europe. 

The recent agreement marks the second successful transaction under a memorandum of understanding established between Naftogaz and Orlen. 

This delivery, amounting to 100 million cubic meters (mcm) of gas, mirrors the volume of an earlier delivery that also took place under the same agreement.