Why the obligation to keep emergency stocks of natural gas?

The obligation to keep emergency stocks of natural gas is stipulated in the Law of 16 February 2007 on Stocks of Crude Oil, Petroleum Products and Natural Gas and on the Procedures to be Applied in the Event of Threat to National Fuel Security or Disruptions on the Petroleum Market.

How can I fulfil the obligation to keep emergency stocks of natural gas?

An entity subject to the obligation to keep emergency stocks of natural gas may purchase the storage service on its own from a domestic or foreign storage system operator and establish stocks based on booked storage capacity. In the case of natural gas stocks kept abroad, it is additionally necessary to ensure the transmission capacity, necessary to transport the natural gas to the domestic transmission system. An alternative solution to meet this obligation is to commission the maintenance of emergency stocks to another entity, whether in Poland or abroad. The service of keeping emergency stocks for the benefit of another entity is called a “Ticketing Service”.

What are the benefits of Ticketing Service offered by PGNiG?

The execution of a Ticketing Service Contract with PGNiG provides the means to meet the obligation to keep emergency stocks of natural gas in compliance with national regulations.

The PGNiG offer is competitive to other solutions offered on the market:

  • The service is designed to meet Customer needs in terms of volume of emergency stocks the Customer intends to keep.
  • The Ticketing Service is provided in a flexible manner throughout the entire term of contract. The term of service provided by PGNiG is 1 Gas Year (with the possibility to extend to 3 Gas Years) and corresponds to the obligatory period of keeping emergency stocks (01 October – 30 September).
  • The Customer is not obligated to execute storage service contracts with a storage system operator, necessary to inject, maintain and offtake emergency stocks.
  • The offer provides a complex “one stop shop” service – depending upon Customer’s decision, based on the power of attorney granted, all reporting duties to the Government Minister responsible for Energy, the President of Energy Regulatory Office URE, Gas Storage Poland (Storage System Operator) or OGP Gaz-System (Transmission System Operator) may be fulfilled within the scope of the service.

What changes have been introduced to the Ticketing Service in Gas Year 2018/2019 as compared to Gas Year 2017/2018?

The previously applied package of documents, comprising: Ticketing Service Rules1, standard form of contracts and standard form of Price List was replaced by a single document entitled the “Ticketing Service Contract” for each of the service options available. Simultaneously, the model of ticketing service provision and the options thereof remain unaltered.

What should be the Term of Contract?

PGNiG offers the provision of Ticketing Service for the period of 1, 2 or 3 Gas Years. The term of contract corresponds to the mandatory period of keeping emergency stocks, i.e. between 01 October and 30 September.

Are there any minimum/maximum volumes of gas that can be stored within the scope of Ticketing Service?

PGNiG adjusts the scope of the Ticketing Service provided to the needs of Customers. Any possible limitations may be associated with the availability of storage and transmission infrastructure.

Where can I find the terms and conditions of the Ticketing Service?

The standard form of the Ticketing Service Contract can be downloaded from our website http://en.pgnig.pl/trade/ticketing-service/what-is-ticketing-service, and the service cost calculator is available at http://en.pgnig.pl/ticketing-service-calculator.

What does the cost of Ticketing Service depend on?

The cost of Ticketing Service depends upon a number of factors, including but not limited to the service option selected and the duration of service provision. The service is offered at market rates, competitive to the services offered by the storage system operator.

At what price can the Customer purchase natural gas when “Customer's Gas” option is selected?

The sales price of natural gas corresponds to market prices as at injection and/or possible replenishment of emergency stocks. Detailed information concerning the calculation of sales price shall be presented in the offer on case-to-case basis.

If I decide to use the PGNiG Ticketing Service offer, what obligations will I have to meet?

Customers are obligated to calculate the volume of emergency stocks and submit such volume to the President of URE for verification. Upon the receipt of decision from the President of URE, the Customer will be obligated to deliver it to PGNiG.

The Customer may grant the power of attorney for representation before the Government Minister responsible for Energy, URE, Gas Storage Poland (SSO) and TSO within the scope of the Ticketing Service Contract.

Entities with no previous history of cooperation with PGNiG are additionally obligated to present basic company data for the purpose of counterparty verification and assessment of its credit worthiness. It is a standard procedure applied by PGNiG in relation to new Customers.

The Customer may be obligated to provide security backing the payments ensuing from the Contract.

Following the execution of Contract with PGNiG, do I need to contact the Energy Regulatory Office URE or the Transmission System Operator concerning Contract performance?

Within the scope of the service provided by PGNiG, the Customer may grant the power of attorney for representation thereof before the Government Minister responsible for Energy, URE, Gas Storage Poland (SSO) and TSO within the scope of the Ticketing Service Contract. The Ticketing Service may be hence provided in the form of a “one stop shop” service. According to the model, the Customer is obligated only to acquire the decision of the President of URE approving the volume of the emergency stocks determined.

How is the volume of emergency stocks calculated?

Pursuant to the Law on Stocks, the volume of emergency stocks of natural gas must correspond to at least 30-days’ average daily import of such gas, determined based on the volume of import during the period from 01 April in the preceding year until 31 March of present year.

Is LNG also subject to the obligation to keep emergency stocks?

Yes, LNG is also subject to this statutory obligation, since LNG is classified as natural gas within the meaning of the Law on Stocks. When LNG terminal is used, the obligation to keep emergency stocks is vested in the entity using regasification or handling services and whose regasified gas is injected into the transmission network or reloaded to other means of transportation.

Under what circumstances are emergency stocks released?

Pursuant to the Law on Stocks, decisions concerning emergency stocks fall within the scope of competence of the Government Minister responsible for Energy. Emergency stocks are released by transmission system operator following the acquisition of consent from the Government Minister responsible for Energy after the occurrence of disturbances in the supply of natural gas to the gas system, of unforeseen damage to or destruction of network resulting in a threat to the security of operations of the gas system or of unforeseen growth in the consumption of natural gas.

How can I receive the gas following the termination/expiration of the Ticketing Service Contract?

Depending upon the option selected by the Customer, after the termination/expiration of the term of Ticketing Service Contract, the gas previously held as emergency stocks may be handed-over to the Customer at OTC Point or repurchased by PGNiG.

1 The Ticketing Service Rules dated 1 August 2017 are binding to the Customers who in 2017 signed the Price List for a period longer than 1 Gas Year