PGNiG, Iran Sign Preliminary Gas Deal

A preliminary deal between Polish gas monopoly PGNiG and Iranian Offshore Oil Company will lead to cooperation between the two companies in the management of previously discovered gas reserves, according to Reuters.

The deal is a result of a visit to Iran by a PGNiG delegation led by Krzysztof Glogowski, president of the board of PGNiG. During the delegation's visit to Iran, the representatives of PGNiG had a series of discussions with the managements of leading oil companies associated with National Iranian Oil Company. The primary focus was on PGNiG's potential involvement in development of field discoveries and joint implementation of investment projects including construction of underground gas storage facilities and facilities to liquefy the gas for exportation.

"Iran is the second-largest country in the world in terms of oil and gas reserves, and our joint projects with Iranian companies not only can contribute to improved profitability of PGNiG but also fit excellently into the business development efforts of the PGNiG Group in external markets," Glogowski said.

The move into Iranian gas could pave the way for Poland to diversify its imported gas supply and become more independent from Russia, which currently supplies 48% of Poland's gas imports. To this end, PGNiG has also recently signed deals that could lead to eventual importation of gas from Libya and Denmark, among other countries. However, the Iranian deal holds the most potential since Iran has nearly one-fifth of the world's gas reserves ready to be exported.

According to the U.S. Energy Information Administration, Poland consumes 489 Bcf/d. Poland only produces 193.2 Bcf/d.

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