Poland’s PGNiG profit hit by impairments

Poland’s dominant gas firm and LNG importer PGNiG reported a 29 per cent lower net profit in the first quarter, hit by impairments.

Quarterly net profit stood at 779 million Zlotys ($196m) when compared to 1.1 billion Zlotys in the January-March period last year.

Revenue also declined 4 per cent year-on-year to 13.76 billion Zlotys.

The Polish company attributed the decrease to 758 million Zlotys impairment losses on non-current assets related to crude oil and natural gas production in Poland and abroad.

The company’s chief executive Jerzy Kwieciński said PGNiG delivered “good results” despite the sharp decline in hydrocarbon prices, a relatively warm winter and the beginning of the coronavirus outbreak in Poland.

Natural gas and crude oil production was at 1.16 bcm and 325 thousand tonnes, respectively, almost flat on the previous year.

The group’s gas sales increased 7 percent in the quarter to 10.3 bcm but declining prices slashed revenue 6 per cent.

LNG imports to the only Polish LNG import terminal in the port of Swinoujscie increased to 0.98 billion cubic meters.

This is a rise of 0.26 bcm year-on-year with LNG now having a share of 28 percent in Poland’s total gas imports.

The country received 10 LNG cargoes during the quarter, including three deliveries under a contract with Qatargas and seven spot shipments.

PGNiG is in charge of all the supplies coming to the import terminal operated by Gaz-System’s unit Polskie LNG.

The company recently also secured additional regasification capacity at the facility.

Poland has significantly increased LNG purchases via its terminal in Swinoujscie following PGNiG deals with Qatargas and US player Cheniere.

The move is a part of reducing the country’s decades-old reliance on Russian pipeline gas but also cutting dependence on coal.