Poland to seek price cut in Yamal gas contract: deputy PM
June 16, 2014
Poland will renegotiate the terms of its long-term natural gas supply contract with Russian giant Gazprom in the fall and expects to achieve a significant price cut, deputy Prime Minister and Economy Minister Janusz Piechocinski has said.
Poland has a number of arguments for a price cut, Piechocinski told the PAP news agency, pointing to prices on the spot market as well as the fact that it is a reliable recipient of, and payer for, Russian gas.
"It is therefore unacceptable for Poland to have a price above the European average, especially since we are located closer to the sources of gas, so the costs of transport are lower,” Piechocinski said.
Long-term gas contracts should include "transparent and flexible” rules for periodical analysis and revision of contract provisions, Piechocinski added.
Poland's state-controlled natural gas group PGNiG signed the Yamal contract with Russia's Gazprom in 2010. Under the deal, Gazprom is to supply up to 10.27 bln cubic meters of gas annually, including 85% under the take-or-pay formula.
PGNiG has already negotiated one price cut, after resorting to an arbitration court in 2012. Under the agreement, a window for renegotiating the price opens again in November 2014.