Market area
Our achievements to date
Imports
PGNiG buys imported natural gas under: a long-term contracts (i.e. long-term contract with OOO Gazprom Export) and under short- and medium-term gas supply contracts with European suppliers.
Attempting to diversify the supplies of imported gas, the PGNiG Group increased the volumes of gas purchased under short-term contracts. The purchases were contracted chiefly by PGNiG Sales & Trading.
PGNiG Sales & Trading purchased natural gas on the German market, mainly in OTC transactions on the NCG (NetConnectGermany) and Gaspool virtual trading platforms. The company also purchased gas on the European Energy Exchange (EEX). In 2013, PGNiG and PGNiG Sales & Trading executed short-term agreements for the purchase of natural gas to be mainly supplied using the reverse flow service on the Yamal pipeline.
In late 2013, PGNiG and NAK Naftogaz Ukrainy signed an agreement to terminate the contract for the supply of natural gas of October 26th 2004. This was due to the fact that, on January 1st 2011, NAK Naftogaz Ukrainy had suspended gas deliveries via the Zosin cross-border point on the Polish-Ukrainian border.
Sales
PGNiG is the largest supplier of natural gas in Poland. Its share of the gas market is approximately 96%, the remaining 4% being held by suppliers from outside the PGNiG Group, who mostly purchase gas from PGNiG.
In 2013, the PGNiG Group sold 16.2 bn m³ of natural gas, with 95% of that as sales from transmission and distribution systems, and the balance as direct sales from gas fields.
In 2013, PGNiG concluded contracts for gas fuel supply, both from the transmission system and from the distribution system, with 86.9 ths new customers.
PGNiG delivered natural gas to customers in Poland. The gas was purchased primarily by industrial customers (mainly in the chemical, oil refining, petrochemical and metallurgical sectors) and by households. Households made up the largest group of customers for natural gas (approximately 6.5 m), accounting for 97% of the entire customer base.
PGNiG began selling gas on the Polish Power Exchange, where it sold approximately 66 m m³ of gas in 2013.
In November 2013, PGNiG became the first direct member of the gas market at the Polish Power Exchange. Previously the Company had executed trades at the exchange through commodity brokers. The Company also agreed to act as a market maker in the natural gas futures market, and to regularly place both sell and buy orders on this market. The key role of a market maker is to enhance the market’s liquidity and transparency.
In 2013, the Wholesale Trading Division was established, with operations involving wholesale trade in natural gas, electricity, heat, property rights under certificates of electricity origin and CO2 emission allowances. In September 2013, PGNiG became a member of the London-based ICE Futures exchange, thanks to which it can now enter into transactions on Europe’s largest platform for trading in carbon credit futures.
In July 2013, PGNiG merged with PGNiG Energia, as a result of which wholesale trading in electricity and related products was consolidated within the Wholesale Trading Division.
The Company continued a project consisting in LNG-based distribution of group E gas fuel to customers in Ełk and Olecko. This project is part of an initiative to switch Pisz, Ełk, Suwałki and Olecko to high-methane gas (PESO project), and involves the construction of an LNG regasification station and two-step pressure reduction, metering and odorising stations in Ełk and Olecko, and the switching of customers in those towns to high-methane gas. In 2013, the Company commenced construction of an LNG regasification station and pressure reduction and metering stations in Ełk and Olecko.
In 2013, PGNiG was engaged in wholesale trading in electricity and related products in Poland and Germany. In Poland, the Company traded on the OTC market under EFET (European Federation of Energy Traders) standard agreements and through brokers, and also on the Polish Power Exchange. In Germany, the Company was engaged in spot contract trading on the EPEX (European Power Exchange) Spot market, and in the inter-system Poland-Germany exchange (between the areas covered by PSE and 50 Hertz Transmission).
PGNiG Sales & Trading was engaged in electricity trading in Germany on the EPEX Spot, EEX Power Derivatives and OTC markets.
PGNiG expanded its offering by launching sales of electricity to business customers (tariff groups A, B and C). The Company also commenced its preparations for the launch of electricity sales to households (tariff group G).
In 2013, the PGNiG Group sold 7,231.6 GWh of electricity, 73% of which was to the Polish market.
Distribution
Polska Spółka Gazownictwa was appointed as the Distribution System Operator and the Natural Gas Liquefaction System Operator until December 31st 2030. The President of the Energy Regulatory Office also granted the company a licence to distribute gas fuel and a licence to liquefy natural gas and regasify LNG at LNG regasification plants until December 31st 2030.
In 2013, Polska Spółka Gazownictwa carried on 18 projects involving the construction, extension and modernisation of its distribution networks, for which, in previous years, the gas distribution companies had concluded agreements on EU co-financing under the Infrastructure and Environment Operational Programme.
In 2013, the Company also pursued projects financed directly with its own funds.
Storage
An amendment to Gas Fuel Storage Tariff No. 1/2012, approved by the President of the Energy Regulatory Office on December 17th 2012, has been in effect since January 1st 2013. This amendment covers charges for storage services, service quality, and settlement methods under short-term contracts. By virtue of a decision of April 30th 2013, the President of the Energy Regulatory Office extended the effective term of the Tariff until September 30th 2013. In July 2013, Operator Systemu Magazynowania Sp. z o.o. applied to the President of the Energy Regulatory Office for another extension of the term of the Tariff until March 31st 2014. The President of the Energy Regulatory Office granted the company’s request in his decision of September 16th 2013.
The working storage capacity of the Mogilno cavern facility was reduced from 411.9 m m³ to 407.9 m m³ as a result of the process of convergence (tightening) of the salt rock mass. On April 11th 2013, the President of the Energy Regulatory Office amended the gas fuel storage licence granted to Operator Systemu Magazynowania to reflect the 4 m m³ reduction in the Mogilno facility’s working storage capacity.
As at December 31st 2013, the PGNiG Group made available a total of 1,817.5 m m³ of working storage capacity for third party access and to OGP GAZSYSTEM. Of this volume, 1,796.0 m m³ was made available under long-term agreements, while 21.5 m m³ was covered by short-term agreements. 0.39 m m³ is allocated for the Mogilno cavern facility’s own needs.
Power Generation
In 2013, as part of the Stalowa Wola CCGT project (a joint project between PGNiG, Tauron Polska Energia SA and Elektrownia Stalowa Wola SA), the PGNiG Group concluded financing agreements for the CCGT unit, and the construction work began. The work included construction of an electricity switching substation with a control room, and foundations for the unit’s main installations. Foundations for the recovery boiler and gas turbine were laid, and work continued on foundations for the steam turbine. The support structure for the gas turbine building was completed and construction of the steam turbine building begun. Also, phase one of work on the San river dam system was completed.
