PGNiG signed a new deal with its Russian suppliers, which raises the price of its imported gas, the company said on Sunday. The two new contracts, with Gazprom and Russia-Ukraine gas agent RosUkrEnergo, raise by around 10 percent the price of gas under PGNiG's main agreement for gas supplies through the Jamal gas pipeline. PGNiG said the contract with RosUkrEnergo guaranteed the supply of 2.5 billion cubic metres, worth around 2 billion zlotys ($672.5 million), annually. The second deal, an annex to a long-term agreement with a subsidiary of Russian energy giant Gazprom raised the cost of its gas by an average of 10 percent to an estimated 6.7 billion zlotys annually.
PGNiG said it will seek to compensate for the rise by asking the state energy regulator URE for an increase in the gas tariff it charges Polish consumers. The application should be submitted within the next few days.
Our view: It is negative news for PGNiG, though the import price increase was widely expected by the market. The utility segment of the company will be under even higher pressure in the winter months. We hope that the company will use the contract as a new argument to convince URE to raise further the tariff prices for natural gas.