Polish gas monopoly PGNiG will spend EUR300 million of its own cash and EUR100 million from debt and other sources on the construction of the first stage of its planned liquefied natural gas (LNG) terminal, the company said.

"The value of the first stage to be finished by 2011 will be around EUR400 million," Tadeusz Zwierzynski, head of PGNiG's LNG unit PLNG, told reporters, reiterating the cost of the whole project should be EUR450 million.

After the first stage, the terminal's capacity will stand at 2.5 billion cubic meters of LNG per year and may be tripled later, depending on usage and demand for the gas it will pump out.

PGNiG earlier this month picked Canadian engineering company SNC-Lavalin to design the terminal, in Swinoujscie on the Baltic Coast, and hopes to get permits in the second half of 2008 allowing it to begin building work.

SNC-Lavalin said it is also considering bidding in the construction tender.

PGNiG, which developed LNG plans as part of Poland's strategy to limit its dependence on imports from Russia, said it is now in talks with three potential suppliers of LNG, one of them from Algeria.

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Related Project
Polskie LNG (PLNG)
Facility Type: LNG Owner: PGNiG SA (Polish Oil & Gas Co.)
Scope: New Construction Location: Swinoujscie Poland