South Korea begins construction of floating LNG terminal for Poland

South Korea has officially launched the construction of a floating liquefied natural gas (LNG) terminal for Poland, set to be operational in Gdańsk by 2028. This floating storage and regasification unit (FSRU) is projected to supply one-third of Poland’s annual gas demand, marking a significant step in the country’s efforts to reduce reliance on Russian energy sources. The initiative comes in response to the geopolitical shifts following Russia’s invasion of Ukraine in 2022.

Construction Details and Future Plans

Adam Bryszewski, vice-president of Gaz-System, Poland’s state-owned gas infrastructure operator, announced that the construction of the FSRU has commenced at the Hyundai Heavy Industries shipyard in Ulsan, South Korea. This marks the beginning of the first phase of the project, which is crucial for enhancing Poland’s energy security. The FSRU will be permanently moored in the Gulf of Gdańsk and will play a vital role in diversifying Poland’s energy sources.

In addition to the FSRU, work will soon begin on the offshore components of the project, including dredging for the terminal’s positioning and the construction of a new 1.3-kilometre-long breakwater. Onshore, three gas pipelines—Kolnik-Gdańsk, Gardeja-Kolnik, and Gustorzyn-Gardeja—are also under construction, aimed at integrating the LNG from the terminal into Poland’s national gas transmission system. These pipelines are expected to be completed by the end of next year.

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The total investment for the FSRU project, excluding ship charter fees, is estimated at 5.3 billion zloty (approximately €1.2 billion). Bryszewski emphasized that the new terminal will help meet Poland’s increasing gas demand, projected to rise from 19 billion cubic metres (bcm) to 28 bcm by 2031. The FSRU is expected to provide an additional 6.1 bcm of gas annually, significantly enhancing Poland’s energy independence.

Broader Implications for Poland’s Energy Strategy

Poland’s strategic shift away from Russian gas has accelerated since the onset of the Ukraine conflict. The country has diversified its energy imports, now sourcing gas from Qatar, the United States, and Norway. Currently, Poland imports LNG through its terminal in Świnoujście, which has a capacity of 8.3 bcm per year. The first LNG tanker chartered by Polish state energy company Orlen completed its inaugural delivery in March 2023, marking a new chapter in Poland’s energy landscape.

Orlen has also secured a binding 15-year order for the full capacity of the Gdańsk FSRU terminal, underscoring the growing demand for gas in Poland and neighboring regions. The FSRU project not only aims to bolster Poland’s energy security but also positions the country as a key player in the regional energy market, particularly in light of increasing interest in Polish gas from Ukraine.