The Baltic Pipe – a challenging legal project and a cross-border masterpiece
The Baltic Pipe, through which Poland has joined European gas transmission structures, is a large scale historic energy investment. Our legal team’s expertise and know-how together with managerial and transnational project management skills proved crucial in this strategic undertaking.
International regulations, tough negotiations, transparency and deadlines
The Baltic Pipe is a complex, multi-phase and multi-dimensional project covering project financing, implementation and regulatory issues.
Our legal team was responsible for:
- development of a project management model,
- preparation of multifaceted analyses, including those relating to legislation and nature protection,
- preparation and negotiation of agreements, including the principal project agreement and the gas compression agreement concerning the gas pipeline operation phase.
Since the Baltic Pipe was primarily financed with European funds, the latter required exceptional transparency and diligence at every stage of project implementation and settlement.
Strategic importance to the energy security of the Baltic States
The new gas corridor is one of Poland’s largest energy infrastructure projects ever, with significant strategic importance for our energy security.
“Given the current events across our eastern border, the Baltic Pipe project takes on an even greater significance. And importantly, in addition to directly supporting the client, our law firm coordinated the work of lawyers in other jurisdictions – including Sweden and Denmark. We’ve shown that, as a Polish law firm, we’re capable of handling transnational projects. And not as a subcontractor, but as their leader” – stressed Wojciech Wrochna, Partner, Head of Energy, Natural Resources & Chemicals.
Given its cross-border nature, the project was a huge challenge due to the comprehensive environmental issues and the pipeline crossing both offshore and onshore areas.
“I’d like to take this opportunity to thank everyone involved in this project – in particular Jacek Kozikowski, PhD – responsible on our side for the key area, the negotiation with the Danes of the main project agreement – the Construction Agreement” – he adds.
Innovative legal project
The Baltic Pipe project is also unprecedented in terms of its comprehensiveness and the scope of required legal advisory.
Our client took on the role of an operator not only in the country, but also within the Swedish Exclusive Economic Zone and Denmark. In addition, a certain part of the project in the Kingdom of Denmark was financed with Gaz-System’s transmission tariff funds.
This innovative solution was possible thanks to the cross-border cost allocation procedure carried out in agreement between the Polish Energy Regulatory Office (URE) and its Danish counterpart – Energitilsynet. We coordinated the work of the Danish law firm which supported Gaz-System in its dealings with the operator there.
“We’re applying the experience gained with the Baltic Pipe to other large-scale projects we’re currently pursuing with our clients both offshore and onshore” – concludes Jacek Kozikowski, PhD, Partner, Head of Infrastructure.
In their “Handling the Baltic Pipe Project: Lawyers’ Greatest Challenges” article, Jacek Kozikowski and Wojciech Wrochna discuss why the Baltic Sea is a challenging area for transmission investments and other relevant facts about offshore projects.
Date: 29 września 2022