Contractual gas supplies from Ukraine to Poland unaffected - PGNiG

July 16, 2014

At present, the supply of imported natural gas to PGNiG SA, including volumes supplied through Ukraine, is continuing uninterrupted. Since the onset of tensions in Ukraine, the Company's Operational Response Team has monitored the developments.

Depending on how the situation develops, the Operational Response Team will take preventive steps to address any problems with gas supplies. Moreover, the PGNiG Management Board is communicating with the Ministry of Economy and the Ministry of State Treasury on an ongoing basis to exchange information on the current situation.

The options available to PGNiG SA if the gas delivery from Ukraine is discontinued are as follows:

- transfer of some gas volumes, in consultation with the supplier, from the Drozdovitse entry point (Ukraine) to the Vysokoye entry point (Belarus),
- increased imports of gas from west of Poland to the extent possible given the available transmission capacity,
- withdrawal of gas from underground storage facilities
- maximisation of domestic gas production,
- limitation of gas consumption by customers on terms specified in the relevant contracts.

At present, the underground storage facilities hold approximately 1.8 billion cubic metres of gas. In view of the current demand, the ongoing process of gas injection into underground storage and the implemented plan to meet the demand (imports, supplies from domestic sources), the possible limitation of gas supplies from Ukraine will not require the Company to withdraw gas from its underground storage facilities.

Natural gas from the countries east of Poland is imported under the agreement between PGNiG SA and OOO Gazprom Export. The gas is transported across Poland's eastern border through the Drozdovitse entry point on the Polish-Ukrainian border, and through the Kondratki, Vysokoye and Teterovka entry points on the Polish-Belarusian border. Other connections used to supply gas under PGNiG's import contracts are located on the Polish-German border (Lasów, Mallnow and Gubin entry points) and the Polish-Czech border (Cieszyn and Branice).

Source: PGNiG, 2014