Poland, Lithuania eye gas link

Poland and Lithuania's gas supply companies said on Friday they intended to build a 471-million-euro ($625 million) pipeline to hook the Baltic states to the rest of the EU's energy market. "We found this to be the most efficient measure to solve the problem of security of supply in the entire Baltic region," said Rafal Wittman, development and investment director of Poland's Gaz-System.
"This will let us end the isolation, or so called energy island, here," he told journalists in the Lithuanian capital Vilnius as he set out the plan. He said the construction of the 562-kilometre (349-mile) pipeline was expected to begin in 2016, and that it would have an annual capacity of 2.3 billion cubic metres.
Gaz-System and its Lithuanian counterpart Lietuvos Dujos have asked the European Union for financial backing, while Lithuania's fellow Baltic republics Latvia and Estonia are also expected to step in. Currently, Russian energy giant Gazprom is Lithuania's only natural gas supplier, via a pipeline across Belarus. Lithuania, a nation of three million people, is working to end Gazprom's politically-tinged monopoly and already plans to build a liquefied natural gas terminal by the end 2014.
Lithuania's Prime Minister Andrius Kubilius hailed the planned land-link with neighbouring Poland, saying it would boost the energy independence drive. "It is very important for the Baltic states to integrate their gas pipeline systems with the rest of Europe's systems. That's why I welcome steps towards the realisation of such a project, though it is not an alternative to the LNG terminal," he told journalists on Friday.
Lithuania, which declared independence in 1990 after five decades of Kremlin rule, has repeatedly locked horns with Gazprom, accusing it of abusing its market clout to impose unfair pricing. Gazprom has denied the claims. The gas dispute has fed into other wrangling between Moscow and Vilnius, whose ties have been particularly rocky since Lithuania joined the EU and Nato in 2004.