PGNiG expects zł.800 million for the first tranche of its bond issue Courtesy of PGNiG

Polish gas monopolist PGNiG will sell up to zł.3 billion in bonds in order to generate capital for exploration and production, and to fund its move into the electricity market.

A consortium of six banks – Bank Pekao, ING Bank Śląski, PKO Bank Polski, Bank Handlowy, Société Générale, and BNP Paribas Polska – has guaranteed the bond program, which will run until the end of July 2013. The securities will have maturity of up to one year and won’t be publicly traded.

PGNiG hopes to pay off some of its debts with the zł.800 million it expects from the first tranche in July.

“Proceeds from subsequent issues will be applied towards investment projects envisaged by PGNiG’s strategy,” spokesperson Joanna Zakrzewska said in a statement. These projects include the development of its gas reserves in Poland and overseas.

PGNiG recently announced that it will invest zł.5 billion a year for several years.

The firm’s CFO, Sławomir Hinc, said last week that PGNiG had already discovered a “substantial” amount of gas in Pakistan. Earlier in June a deposit of up to 16 billion cubic meters of gas was found in a Norwegian gas field in which the company has a 12 percent stake.

Mr Hinc went on to say that his firm would spend more money on power plants in the next few years as well.