Poland’s largest oil and gas producer, PGNiG, has posted mixed financial results, with the growing contribution to the bottom line from its upstream assets in the country, the North Sea and Pakistan partially spoiled by its trade and storage segment that ended up in the red.

According to its consolidated financial statement, PGNiG enjoyed strong revenue growth in all business segments of its operations.

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Total revenues for the group rose by 42% to 27.5 billion Polish zloty ($6.6 billion) in the period between January and September this year, compared with the same period of 2020.

However, the company's net income fell to 3.1 billion zloty this year against 6 billion zloty in 2020.

On a webcast on Thursday, PGNiG executives said it received a one-time payment of 4.9 billion zloty from Gazprom last year, being a retroactive correction to adjust for lower gas prices that the Russian gas monopoly had to apply to gas sales to Poland in previous years.

Rising hydrocarbon prices and better performing upstream offshore assets in the North Sea doubled revenues in PGNiG’s exploration and development division to more than 7 billion zloty, with a pre-tax operating profit of 4.5 billion zloty against the loss of 190 million zloty in 2020.

However, the trade and storage segment of the company’s business registered an operating loss of 804 million zloty in the first nine months of this year against a hefty profit of 8 billion zloty in the same period of last year.

This segment posted a 42% increase in revenues to almost 30 billion zloty this year. However, on the disappointing side, purchase costs and other expenses related to this segment, rose more than two fold to 30.7 billion zloty.

PGNiG executives did not provide a detailed explanation for the poor profitability of the trade and storage segment this year, instead referring to higher liquefied natural gas and pipeline gas imports from Gazprom in the reporting period.

According to the company, LNG imports grew by 7% to the equivalent of almost 12 billion cubic metres while Russian gas deliveries rose by almost 11% to 7.3 Bcm between January and September this year, against 2020.

Spot gas prices at European hubs were hovering at record high levels of $1000 per 1000 cubic metres in the third quarter as the continent saw declining gas supplies from Russia and the US.