Bloomberg: PGNiG to Lift Foreign Oil and Gas Output as Competition Toughens
Polskie Gornictwo Naftowe i Gazownictwo SA, Poland’s dominant gas company, plans a sixfold increase in gas and oil production abroad to counter strengthening competition on its domestic market.
The Warsaw-based utility wants to invest as much as 50 billion zloty ($14 billion), including in acquisition of exploration and production assets, as it seeks to boost foreign output to about 50 million barrels of oil equivalent by 2022, according to a new strategy for 2014-2022. Regulatory changes will “adversely affect revenues,” PGNiG said in the document published late yesterday.
The state-controlled company, which buys about 60 percent of natural gas from Russia’s Gazprom OAO (OGZD) through a fixed-tariff contract, is competing with cheaper imports from Germany as European prices fell 21 percent this year. PGNiG is also under pressure from regulators to sell more fuel through an exchange rather than in bilateral deals with buyers.