March 20, 2012 / 1:07 PM / 6 years ago

PGNiG to minimise gas purchases from Russia in 2012

WARSAW, March 20 (Reuters) - Poland’s gas monopoly PGNiG plans to reduce this year’s purchases from Russia to a contracted minimum without incurring penalties, a PGNiG management board member said on Tuesday.

PGNiG gas imports rose to 10.9 billion cubic metres last year, with the bulk coming from Russia’s Gazprom at a highly uncompetitive price fixed in a long-term contract.

The price in PGNiG’s deal with Gazprom is linked to a nine-month moving average of oil prices, which rose 44 percent in annual terms in the fourth quarter of 2011. The cost was boosted by a 12 percent drop in the Polish zloty to the dollar.

“We want to minimise purchases to 85 percent of the volume contracted with Gazprom for this year, that is 10.245 billion cubic metres, and supply the rest via the virtual reverse, through Lasow (from Germany) and from the Czech Republic,” Radoslaw Dudzinski told reporters.

PGNiG posted an unexpected net profit in the fourth quarter because it bought cheaper Russian gas from Germany through the so-called virtual reverse, which allows it to benefit from the better terms available to German firms, and through expanded links to gas systems in neighbouring countries.

The state-controlled group is in a dispute with Gazprom over gas pricing. In February it sought the intervention of an international tribunal by filing a lawsuit against the Russian firm.

Poland’s gas policy envisages decreasing dependence on costly Russian supplies by building a liquefied natural gas (LNG) terminal and expanding as well as developing new links to other gas systems in the region. (Reporting by Pawel Bernat, Writing by Maciej Onoszko,; Editing by Mark Potter)

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