PGNiG about 2018: diversification, more LNG, less gas from Russia

In 2018, PGNiG brought more than 0.62 billion cubic metres from the East. less natural gas than in 2017 (which represents a drop of 6.4%). Imports from the East amounted to around 9.04 billion cubic metres compared to about 9.66 billion cubic metres in 2017.

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LNG imports (from Qatar, Norway and the USA) increased by nearly 1 billion metres in 2018. (an increase of 58.2%) and reached more than 2.71 billion cubic metres. (after regasification), compared to 2017 when approximately 1.72 billion m of 6th LNG (after regasification).

Thus in 2018, imports from the eastern direction accounted for 66.8 percent of the total PGNiG import structure (in 2016 they accounted for 88.9 percent).

LNG imports accounted for over 20% of import structures (in 2016 it accounted for 8.4%). The rest of the imports cover the western and southern directions.

Throughout 2018 PGNiG brought to Poland approximately 13.53 billion cubic metres of natural gas. According to the forecasts, domestic extraction amounted to 3.8 billion m six.

Clause take or pay concluded in the Jamaican contract signed in the mid-1990s, obliges PGNiG to pay Gazprom by the end of 2022 for approximately 85 percent of the quantity of contract gas, whether we bring it to Poland or not," said Maciej Woźniak, Vice President of the Management Board of PGNiG SA for commercial affairs. "We must therefore continue such purchases for four more years, but we try to reduce them to the threshold required by the contract. All the more so, because the gas under the Jamaican contract is sold to Poland on non-market terms – we have been arguing in this case for several years before the Court of Arbitration in Stockholm. In addition, we are still under the risk of unannounced interruptions in deliveries from the East, which we have faced many times. Our current priority is therefore the parallel construction of an alternative long-term safe supply portfolio from 2023, based on market principles and prices. This portfolio will be based on both LNG and gas from the Norwegian shelf brought by Baltic Pipe gas pipeline – added Maciej Woźniak, Vice President of the Management Board of PGNiG SA for Commercial Affairs.

PGNiG successfully continues its strategy of independence from one dominant supplier. In addition to the expansion of the LNG portfolio, the Company is preparing to start supplying the Polish market with gas produced on the Norwegian Continental Shelf, whose transport by Baltic Pipe pipeline through the North Sea, Denmark and the Baltic Sea will begin in late 2022.

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The clear increase in the imports of liquefied natural gas in 2018 is primarily the result of an additional agreement from 2017 from Qatastas. After 2020, annual imports from Qatar will amount to up to 2.7 billion cubic metres after regasification. In addition, already in 2019 the first deliveries of LNG from Cheniere will reach Poland under long-term contracts concluded in 2018 with US suppliers. Thanks to contracts for the purchase of American LNG, between 2023 and 2042 PGNiG will additionally have a portfolio of over 7.3 billion cubic metres each year after regasification (about 5.5 million tonnes of liquefied gas).

Source of PGNiG.