Polish gas company still betting on London

WARSAW, Poland, June 28 (UPI) -- Making a move on the global market for liquefied natural gas, Polish company PGNiG said it was setting up shop in London even as it charts its post-EU future.

"We are upholding our decision to open an LNG trading office in London," PGNiG President Piotr Wozniak said in a statement emailed to UPI.

Global stock indices collapsed for two straight days following last week's British referendum to leave the European Union. Major credit ratings agencies this week downgraded their stance on the British economy, with Standard & Poor's stripping the United Kingdom of the coveted AAA rating on Monday.

British Chancellor of the Exchequer George Osborn warned as the downgrades came that "it will not be plain sailing in the days ahead," for the British economy as it charts its future without the close link to the EU market.

Nevertheless, the Polish company said it was planning to open a trading office in London by next year, with operations in full swing by the first quarter.

"We will be buying LNG at competitive prices for our own needs, but will also start trading it on global markets," PGNiG's Vice President for Trade Maciej Wozniak said. "That is why we are opening an office in London, the gas trading hub for Europe."

In a separate statement, the Polish company said it received its first-ever shipment of LNG bought on the spot market through a delivery from Norwegian ports to the President Lech Kaczyński LNG terminal in Poland

"LNG spot deliveries are a way to further diversify the gas supply sources, and facilitate effective optimization of the group's procurement portfolio," the company explained

The European Commission last year lauded Poland's plans to grant nearly $830 million in grants to nine different gas projects meant to advance a "true energy union" by creating more connections to regional economies.

Five of the nine gas projects set to receive Polish state assistance will connect to European gas networks in the Baltic, Adriatic and Black Seas. The remaining four will eliminate bottlenecks within the Polish transit network.

European leaders are working to add diversity to an energy sector that relies heavily on Russia. LNG, which has more deliverability options than pipelines, may present a source of diversity with the right infrastructure in place.