Poland chemical companies hit by 15% gas price hike

16 March 2012 13:30  [Source: ICIS news]

LONDON (ICIS)--A gas hike averaging around 15% for industrial consumers will add tens of millions of euros to the 2012 costs of each of Poland’s major chemical producers, analysts said on Friday.

Extra expenditure of approximately zlotych (Zl) 200m ($63.5m, €48.5m) would be incurred by oil, chemicals and petrochemicals group PKN Orlen, while Poland's largest chemical and fertilizer group by revenue, Zaklady Aztoy Tarnow (ZAT), and fertilizer, melamine and caprolactam producer Zaklady Azotowe Pulawy (ZAP), would see costs increase by around Zl 140m, according to Erste Group Bank.

Energy regulator URE approved a gas price rise at the request of Polish gas monopoly PGNiG which has faced climbing gas import prices, but Wood & Company investment bank noted that 15% was at the lower end of what PGNiG was hoping for.

“The good news is that the impasse [regarding whether a price rise should be approved] is over and that the regulator has finally acted, although this has come too late [for PGNiG], and after the heating season has finished,” said Wood & Company analyst Robert Rethy.

“The bad news for PGNiG is that in the meantime, crude oil prices [which gas prices are linked to] have rallied further, which is likely to put additional pressure on the trading segment, as the import cost of gas may be rising again,” he added.

Poland imports approximately two-thirds of its gas from Russia.

($1 = €0.76, Zl3.15)
(€1 = Zl4.12)


By: Will Conroy
+44 20 8652 3214



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