PGNiG's big plans

PGNiG, the Polish gas monopoly, posted a net profit of zł.929 million on sales revenues of zł.18.4 billion, amounting to respective y/y increases of one percent and 11 percent. The firm took a big hit in Q4, however, when it recorded a net loss of zł.310 million, down 33 percent on Q4 2007.

PGNiG blamed its Q4 loss on the depreciating złoty and a drop in the amount of natural gas used from storage facilities, which affected sales margins.

This year the capital group will spend some zł.5 billion on investment projects in areas including exploration for and development of deposits, and construction of underground gas storage facilities. In addition, the group is weighing entry into power sector projects through partnerships in which it would exclusively provide gas supplies to power plants.

According to Katarzyna Kędracka, a press officer at PGNiG, the firm has already signed letters of intent with Tauron, Energia and LOTOS and is in talks with several other firms. PGNiG, Tauron and Energia are expected to sign an agreement to build a 400-MW gas-fired generator by the end of this year. The plant, to be delivered in late 2014, would consume about 500 million cubic meters of gas per year.

PGNiG is also working to diversify gas supplies, an especially important matter given recent difficulties with Russian gas. It was announced last week, for example, that the firm is interested in building a pipeline through Slovakia to Baumgarten in Austria. Kędracka noted that the project is intended as a connection to the proposed Nabucco pipeline, which would run from Turkey to Austria. The trans-Slovakian pipeline project is thus contingent on progress being made on Nabucco.

Poland's gas giant did not provide a forecast for 2009, but noted that Q1 would be as difficult as Q4 2008 was. "The PLN/USD exchange rate is not helping us with the cost of imported gas," Kędracka noted.

E Blake Berry