Trade Unions: High gas prices pushing companies to failure

Date: 8 March 2002
Source: FT

Date: 8 March 2002

High gas prices set by the Polish Oil and Gas Mining Company (PGNiG), are pushing chemical, glass, and ceramics companies to the verge of bankruptcy, trade unions representing the industries claim in a letter sent to Prime Minister Leszek Miller.

The trade unions have asked the prime minister for help in amending the Energy Law, which could break the monopoly of PGNiG and send gas prices down. They also demand that gas prices should be lowered in case the price of imported gas falls more than 5 percent and that chemical, glass, and ceramics companies should be allowed to buy cheap Polish gas. In addition, the trade unions are against cross-subsidies that under the present Energy Law enable financing municipal gas recipients from gas fees obtained from industrial buyers. The authors of the letter believe that high gas prices may ultimately harm PGNiG itself as the present situation may result in a 30-percent drop in gas demand if the main nitrate producers can no longer afford to buy gas at the prices demanded by the gas monopolist.
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