* Strategy focused on boosting value, financial stability
* Cumulative 2017-2022 core earnings seen at 33.7 bln zlotys
* Warns planned dividend payments may be postponed
WARSAW, March 13 Poland's biggest gas firm PGNiG
said on Monday its capital spending would exceed 34
billion zlotys ($8.4 billion) over 2017 to 2022, with almost
half to be spent on exploration and production.
The state-run firm wants to increase its current documented
hydrocarbon reserves by about 35 percent and boost hydrocarbon
production by about 41 percent, it said in a statement.
Poland consumes some 16 billion cubic metres of gas a year
but most of it comes from Russia as PGNiG has a long-term gas
supply contract with Gazprom - the so-called Yamal
contract - that runs until 2022.
PGNiG is now struggling to secure alternative supplies after
that date. Poland's first liquefied gas (LNG) terminal, on its
Baltic coast, received its first commercial shipments in July
and the country is also planning a pipeline to Norway.
It said the strategy has been prompted by rapidly growing
competition in the Polish gas market as well as the need to
diversify gas imports from 2022 onwards, among other factors.
Average annual capital expenditure for 2017−2022 will come
to about 5.7 billion zlotys and the programme should deliver
cumulative earnings before income tax depreciation and
amortisation (EBITDA) of 33.7 billion zlotys over the period.
PGNiG said it expected the investment to help boost EBITDA
to an annual average of some 9.2 billion zlotys for 2023-2026.
The company reiterated that it wanted to keep its net debt
to EBITDA ratio below two.
It also said it would stick to its policy of paying out up
to 50 percent of profits in dividends but warned there could be
"PGNiG will recognise net profits of its subsidiaries in the
consolidated accounts net of any dividends paid by the
subsidiaries, so achieving the planned level of dividend
payments may be postponed by one year," it said.
($1 = 4.0609 zlotys)
(Reporting by Lidia Kelly and Agnieszka Barteczko; writing by
Lidia Kelly; editing by David Clarke)