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Gazprom, PGNiG reach agreement on new gas price

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17:22 06/11/2012

MOSCOW, November 6 - RAPSI. Gazprom and Polish oil giant PGNiG SA have signed a supplementary agreement to their gas contract, thereby changing the prices of supplies to Poland via the Yamal-Europe pipeline, PRIME agency reported with reference to a Gazprom press release on Friday.

Gazprom Deputy Chairman of the Board Alexander Medvedev and PGNiG SA Chairman of the Board Grazyna Piotrowska-Oliwa met in Warsaw.The company officials agreed to close proceedings in the Stockholm Arbitration Tribunal, which PGNiG initiated against Gazprom. Earlier, PGNiG sought a 20% discount on gas supplied from Gazprom.
Poland pays an average of $550 per 1,000 cubic meters, while the price for Russia's remaining European customers is an average of $450.

In October 2011, PGNiG informed Gazprom and Gazprom Export that it had submitted to the tribunal a statement on the initiation of a commercial hearing, which was opened in an effort to reduce the long-term gas prices for Poland by taking into account changes in the market.

PGNiG said at the time that the launch of the procedure did not mean that its commercial talks with Gazprom on changing the prices, which were initiated in spring 2011, should stop.

The Polish company initiated the process of reviewing the gas prices in April 2011.

In Spring 2011, PGNiG asked Gazprom to reduce its prices by 10 percent and threatened to launch a commercial dispute against the company. PGNiG insists that the discount that it received at the time was not a one-off agreement, and the method for calculating prices should be changed to the formula that functioned prior to November 2006.

The formula was amended due to the need for additional supplies, and the price grew by 11 percent. The talks yielded no results.

The Polish company's proposal was submitted after Gazprom agreed to give 15-percent discounts to Estonia and Latvia in 2011 and to change the method of calculating its prices for some clients, such as E.On Ruhrgas, GDF Suez and Eni.

PGNiG is Poland's largest oil and gas company. In 2011, Gazprom exported 10.25 cubic meters of gas to Poland, which amounts to 70 percent of the country's needs in gas.

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Gazprom, PGNiG reach agreement on new gas price

17:22 06/11/2012 Gazprom and Polish oil giant PGNiG SA have signed a supplementary agreement to their gas contract, thereby changing the prices of supplies to Poland via the Yamal-Europe pipeline.
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