Poland’s PGNiG significantly cut gas imports from Germany and a liquefied natural gas re-gasification terminal in the Baltic port of Swinoujscie in the third quarter, as Russian pipeline gas became a more attractive option.
The state-owned company said in its latest financial report that the share of imports of LNG fell to 20% of a total volume of 3.7 billion cubic metres of gas imported into Poland in the three months to the end of September.
In the first half of this year, the share of LNG imports remained steady at about 30%, with a total of 7.5 Bcm of gas entering Poland's domestic market from outside the country.
Additionally, the flow of gas via reversed pipeline connections with Germany also declined, to about 12% in the third quarter against approximately 16% in the first half, PGNiG said.
Despite litigations with Russian gas monopoly Gazprom over contract pricing, and intermittent operations of the Yamal gas pipeline in the second quarter following the expiry of a long-term gas transit agreement between the two countries in May, supplies of Russian gas to the country returned to normal in the third quarter.
According to PGNiG, Gazprom supplied 68% of gas imports in this period, against an average of 55% in the first half of this year.
PGNiG is currently hoping for Gazprom to revise the price formula for this year’s gas supplies to Poland to further reduce the price of Russian gas, which is already down following the decline in international energy prices earlier this year.
A company executive said that PGNiG hopes to reach an out-of-court price settlement with Gazprom after an arbitration court in Sweden ruled earlier this year that the Russian gas monopoly had to pay over $1.5 billion to PGNiG.
The amount reflects a re-calculation of Russian gas prices on deliveries to PGNiG in the period from 1 November 2014 to 29 February 2020.
PGNIG said in the statement that it used the payment from Gazprom to offset operating costs that fell by 35% to 16.7 billion zloty ($4.4 billion) between January and September this year against the same period of 2019.
Gross revenues of the Polish producer declined by 7% to 27.4 billion zloty in the first nine months, the company said.
Gazprom’s payment and re-evaluation of PGNiG equity interests led to record net income of over 6 billion zloty this year against 1.3 billion zloty between January and September 2019.