Where does the obligation to hold mandatory gas stocks come from?
The obligation to hold mandatory gas stocks follows from the Act of February 16th 2007 on stocks of crude oil, petroleum products and natural gas, the principles of proceeding in circumstances of a threat to the fuel security of the state and disruption on the petroleum market.
How can I fulfil my gas-stocking obligation?
An obligated entity may purchase storage services from a local or foreign gas storage system operator, and build gas stocks based on the reserved storage capacities. If gas stocks are to be held outside of Poland, the obligated entity is additionally required to reserve sufficient transmission capacities to enable gas transport to the Polish grid. As an alternative, the obligation may be fulfilled by contracting another entity, which is under the same obligation, to hold the mandatory gas stocks on a contract basis. Such service, called ticketing, is provided by PGNiG.
What are the advantages of the ticketing service provided by PGNiG?
Signing a contract for the provision of the ticketing service with PGNiG allows the Customer to meet its gas-stocking obligations in accordance with the applicable Polish regulations.
PGNiG’s service is competitive compared with other solutions available on the market:
- The service is tailored to the Customer’s volume needs. To compare, Gas Storage Poland offers only standard storage volume options.
- The ticketing service provided by PGNiG is also flexible in terms of contract duration – it is offered for a period of one gas year (with optional extension to three gas years), which is consistent with the mandatory stock holding period (October 1st – September 30th).
- The Customer is not required to enter into an agreement with the gas storage system operator to buy services necessary to inject, maintain, and withdraw the obligated stocks.
- Moreover, the Customer does not have to reserve any transmission capacities to ensure that the obligated stocks can be delivered within 40 days throughout the entire storage period, which would be necessary if the stocks were stored abroad.
The service is a comprehensive solution – the Customer may choose to authorise PGNiG to fulfil most of its disclosure requirements, laid down in the Act on Stocks, towards the Minister of Energy, President of the Energy Regulatory Office, Storage System Operator (SSO) and Transmission System Operator (TSO).
How is the ticketing service priced?
The price of the ticketing service depends on a number of factors, but mainly on the selected service provision model and contract duration. The price is based on market rates and is competitive compared with services offered by the Storage System Operator.
What is the term of a ticketing service contract?
At the Customer’s option, a contract for the provision of the ticketing service may be signed for one, two, or three gas years. We offer a framework contract under which the Customer will be able to place separate orders for the ticketing service. The framework contract itself does not entail any obligations or costs for the Customer. Payment to PGNiG is due only upon order placement.
Are there any minimum/maximum gas volumes to be stored under the ticketing service?
The volume of gas stored under the ticketing service is tailored to the Customer’s needs. Restrictions, if any, may result from limited access to storage or transmission infrastructure.
Where can I find detailed terms and conditions of the ticketing service?
The draft ticketing service contract can be found at http://en.pgnig.pl/ticketing-service.
Please note that the provisions of a ticketing contract are subject to approval by the President of the Energy Regulatory Office, which means that its final wording may differ from the draft.
If I decide to enter into a contract for the provision of the ticketing service with PGNiG, are there any obligations I still have to fulfil?
The Customer is obligated to calculate the volume of the mandatory gas stocks and submit it for approval to the President of the Energy Regulatory Office. Upon receipt of the President of the Energy Regulatory Office’s decision, the Customer must forward it to PGNiG.
Upon execution of the framework contract, the Customer may authorise PGNiG to represent the Customer before the Minister of Energy, the Energy Regulatory Office, Gas Storage Poland (SSO) and the TSO in matters related to the performance of the ticketing service contract.
First-time customers will be asked to provide basic information about their company to allow PGNiG to verify its new business partners and evaluate their creditworthiness. This is PGNiG’s standard procedure for new accounts.
Upon signing the contract with PGNiG, do I still have to contact the Energy Regulatory Office, the Storage System Operator or the Transmission System Operator with regard to the contract performance?
Upon execution of the framework contract, the Customer may authorise PGNiG to represent the Customer before the Minister of Energy, the Energy Regulatory Office, Gas Storage Poland (SSO) and the TSO in matters related to the performance of the ticketing service contract. The ticketing service may thus be provided on a “one-stop shop” basis, where the Customer’s only obligation is to secure the President of the Energy Regulatory Office’s approval of its mandatory stock volume.
Irrespective of that obligation, by May 15th of every year the Customer must notify the President of the Energy Regulatory Office of its mandatory stock volume, determined based on the volume of imports between April 1st of the previous year and March 31st of the current year.
How is the mandatory stock volume calculated?
Pursuant to the Act on Stocks, the volume of mandatory gas stocks must be equal to at least 30-day average daily gas imports, determined based on the volume of imports between April 1st of the previous year and March 31st of the current year.
In the case of entities that will become obligated to maintain mandatory gas stocks for the first time from October 1st 2017, the mandatory stock volumes will be determined based on their gas imports between January 1st and June 30th 2017.
Is there an obligation to hold mandatory stocks of LNG?
Yes, LNG is also covered by the statutory obligation, since it is defined as natural gas pursuant to the Act on Stocks. If an LNG terminal is used, the obligation to maintain mandatory stocks applies to entities that use regasification or handling services, and whose re-gasified gas is injected into the grid or transferred to other vehicles.
When are mandatory gas stocks released?
Pursuant to the Act on Stocks, mandatory gas stocks remain at the disposal of the minister competent for energy. Stocks may be released by the TSO upon the minister’s approval in the event of any disruption in natural gas supply to the gas system, unexpected damage to or destruction of the gas grid affecting the gas system security, or an unforeseen increase in natural gas consumption.
How can I receive the gas after expiry of the ticketing service term?
Depending on the service model selected by the Customer, after expiry of the service term, the gas previously stored as mandatory stock may be delivered to the Customer at an OTC point or repurchased by PGNiG.