Annual Report 2011
The present publication is the first integrated report released by GAZ-SYSTEM S.A., which, at the same time, describes the sustainability measures undertaken by the company and presents the financial and non-financial performance results for the year 2011. The document will be updated annually. To date, in addition to its annual reports, GAZ-SYSTEM S.A. has published reports related to its membership in the Global Compact, an international initiative of the UN Secretary-General (for years 2010, 2011 and 2012), which are available on the corporate website.
To ensure the completeness of the document, the company set up a workshop for key employees and managers of GAZ-SYSTEM S.A., during which the guidelines for the report were defined. The participants gathered the most important data concerning the projects implemented in the company within respective business strategy areas. The report refers to performance indicators for all aspects of the company’s activity, i.e. economic, environmental and social, as set out in the Global Reporting Initiative (GRI) guidelines on application level B. The content of the report was regularly consulted with key internal stakeholders and has been approved by the leaders of the respective subject areas.
The content presented in the report was selected based on the materiality principle, which GAZ-SYSTEM S.A. understands as reporting on issues that are relevant in the context of sustainability both for the organisation and its stakeholders. The information provided in the report was compiled based on the analyses and statistics kept by the company, and its scope covers both the head office of GAZ-SYSTEM S.A. and its six branches. The publication was not subject to external assurance.
The next sections correspond to the respective pillars of the business strategy of GAZ-SYSTEM S.A. and are marked with the following icons:
Sustainable Energy Market European Effective
Contents
Message from Chairman of the Supervisory Board
4
Message from President of the Management Board
6
GAZ-SYSTEM S.A. – the system that connects
10
Sustainable Development
28
Energy Security
52
Market Development
62
European Partner
68
Effective Management
74
Financials
86
GRI Content Index Table
101
Evaluation Questionnaire
109
Message from Chairman
of the Supervisory Board
Ladies and Gentlemen,
2011 was a momentous year for GAZ-SYSTEM S.A., as it marked the completion of some major investment projects for the expansion of the domestic transmission system and integration with our adjacent systems. Over 100 kilometres of new gas pipelines were built, including the first cross-border connection with the Czech Republic. We also launched a virtual reverse flow service on the Polish section of the Yamal gas pipeline. As a result, the technical capacity for supplying gas to Poland from new sources increased by 3.3 bcm per annum, i.e. over 30% of our previous imports. This way, our company has created a conducive environment to improve the competitiveness of Poland’s economy, its energy security and integrate Europe’s transmission systems into a single network.
Companies employing modern management solutions are able to effectively translate their posi-tive community relations into a strong market position and sound financial standing. By adopting the corporate strategy until 2020, the Supervisory Board recognised the non-financial aspects of company’s performance and made the decision to integrate the social, environmental and economic components into all its business activities. Therefore, the present report contains a comprehensive presentation of our accomplishments and pursuits both on business dimension and in terms of corporate social responsibility.
The strategy developed by GAZ-SYSTEM S.A. aims to tackle the challenges of the ever-growing European gas market and in the time horizon until 2014 provides for:
• completion of the LNG Terminal in Swinoujscie,
• completion of Poland’s transmission network expansion to include 1000 km of new gas pipelines, especially in north-western, central parts of the country and in Lower Silesia.
The above investment projects are focused on enabling gas imports to Poland from a diversified range of suppliers and the liberalisation of the gas market in Poland. Our work plan until 2020 will support the strategic goal of connecting the so-far isolated transmission systems, specifically through the following projects:
• The North-South Gas Corridor in Central Eastern and South Eastern Europe (development
of cross-border interconnections with the Czech Republic and Slovakia),
• The Baltic Energy Market Interconnection Plan (BEMIP) in gas (interconnection of Poland’s
gas pipeline system with transmission systems in Denmark and Lithuania).
Last year, marked by uncertainty over energy resource prices, demonstrated that a holistic approach to running business activity is key to stability in turbulent times. A long-term strategy is much needed to provide financing for energy projects which naturally require a long-term commitment and address long-term energy challenges. Thanks to the fact that the PLN 8 billion investment programme put forth by GAZ-SYSTEM S.A. won the confidence of the European Commission, the European Investment Bank and a bank consortium, in 2011 we successfully secured our financing until 2014. The positive response from these partners confirmed us in the conviction that our integrated, community-based approach to doing business is the right one. Our goals of becoming a major integrator in the EU gas market and a leader in Central Europe, as well as the investment tasks facing the management and employees are very ambitious indeed. However, judging by our experience so far, we firmly believe that our projects will see completion within the planned timeframe and to the highest quality standards.
Yours faithfully,
Jerzy Molak
Chairman
of the Supervisory Board
Message from President
of the Management Board
Ladies and Gentlemen,
It is my pleasure to present to you the 2011 Integrated Annual Report of GAZ-SYSTEM S.A. which was, for the first time, drawn up in accordance with the Sustainability Reporting Guidelines prepared by the Global Reporting Initiative. The present report describes both the company’s financial results and non-financial economic, social and environmental performance.
Due to the remarkable scale of its impact, the energy industry is obliged to operate under a “social contract”. Building trust requires long-term commitment which is a prerequisite to the efficient operation of the company in its environment. A similar strategic perspective was adopted by GAZ-SYSTEM S.A. In the times of concern over energy prices and eroded confidence, we consider this approach as a chance for sustainable growth of the company.
Sustainable development
The ever-growing demand for natural gas from European economies, liberalisation of the gas market in Poland, need to improve market competition and the EU energy solidarity policy which envisages a full integration of the European transmission systems are challenges which we are addressing by building an organisation based on trust.
The review of 2011 provides GAZ-SYSTEM S.A. with an opportunity to reflect upon the quality of our performance in the social and business environment. In 2011, we adopted a long-term business strategy which is designed to integrate and balance the environmental, social and economic aspects of our business activity. The strategic goals set the directions for our operations in the years to come.
System expansion and integration
With our efforts to build an integrated transmission system, we are striving to meet the energy needs of European consumers by providing the technical framework for free gas trade in the region. We are committed to enable our customers to build their supplier portfolio strategies based on a modern, flexible transmission network that is integrated with the European grid. In seeking to meet these challenges, we devoted our efforts in 2011 to expanding the gas pipeline system in Poland and establishing connections to integrate our domestic system with the European transmission network.
For the first time in the history of Poland’s gas industry, we have managed to build and put into operation over 100 km of gas transmission pipelines, thus creating alternative transmission options. 2011 also marks the completion of several investment projects which are important to Poland’s transmission system, including Goleniow and Jaroslaw compressor stations, the Wloclawek-Gdynia gas pipeline and, finally, the gas pipelines in Lower Silesia, which enabled increased import capacity via the Lasow entry point on the Polish-German border.
We developed the capability for importing gas into Poland from the South by launching the Poland-Czech Republic gas interconnection. This connection is an important component of the North-South Gas Corridor, a project which we hope will enthuse our partners. Ultimately, the project will connect the Polish, Czech, Slovakian, Hungarian and Croatian transmission systems and our transmission infrastructure will play an important role in integrating gas grid in this part of Europe. We are convinced that the Corridor will enable gas customers in the region to benefit from the pricing flexibility of spot markets and the global LNG market.
In order to achieve this goal, our subsidiary company Polskie LNG, in conjunction with Szczecin and Swinoujscie Seaports Authority and Maritime Office in Szczecin, is building an LNG Terminal in Swinoujscie.
Liberalisation of the gas market in Poland
It is an operator’s responsibility to encourage market liberalisation by creating transparent tools and operational mechanisms. GAZ-SYSTEM S.A. has been successful in taking on the role of an independent system operator for the Polish section of the Yamal pipeline until the end of 2025. Thanks to the Transmission Network Code (TNC) of the Polish Section of the Yamal-Europe Transit Gas Pipeline System approved by the President of the Polish Energy Regulatory Office, we currently are able to provide transparent access to unused transmission capacity on this pipeline to all interested users. The virtual reverse service was also made available, which enables importing additional gas volumes into Poland from the western direction via the Wloclawek and Lwowek entry points on the Yamal pipeline. It allows annual imports of approximately 2.3 bcm of gas. An important aspect in the development of Poland’s gas market is the introduction of the Entry-Exit tariff by GAZ-SYSTEM S.A. The work carried out in 2011 to designate the physical entry and exit points of the transmission system will provide improved guidance of the system users and enable a broader scope of services to be offered by the company.
In aggregate, the above investment projects increased the technical import capacity of natural gas into Poland from new (western and southern) directions by 30% per year. We have also managed to organise financing for a PLN 8 billion investment programme until 2014 in order to take full advantage of non-refundable EU aid and own resources. Once completed, these projects will contribute to the increased competitiveness of Poland’s economy.
The continuing development of our staff’s professional qualifications and personal capabilities is reflected in the ever increasing quality of our work. We firmly believe that our investment projects, which are delivered in a responsible manner while demonstrating positive community relations and respect for the environment, will ultimately bring the benefit of lower gas prices for end consumers. In doing so, we also strive for greater public trust, as we consider it of primary importance in our market and community relations. These values will continue to drive the growth of our company.
A positive conclusion of the financial year 2011 would be impossible without the on-going support and commitment all the employees of GAZ-SYSTEM S.A. and our business partners. This is why I am pleased to present our Integrated Annual Report which contains a detailed description of our joint efforts. On behalf of the Management Board of GAZ-SYSTEM S.A., let me express my sincere gratitude and wish you a pleasant read.
Yours faithfully,
Jan Chadam
President
of the Management Board
2152
9 853
15.6
869
14
57
1.53
1.10
0.42
6.15
GAZ-SYSTEM S.A.
in numbers
Net sales revenues
PLN BILLION
Operating costs
PLN BILLION
Net profit
PLN BILLION
Total assets
PLN BILLION
Volume
of gas transported
bcm
Length of transmission
network
km
Number
of system points
Number
of compressor stations
Number
of gas stations
Value at 31.12.2011Number
of employees
persons
Company Overview
Gas Transmission Operator GAZ-SYSTEM S.A. is the company responsible for the transportation of natural gas and the operation of the transmission network in Poland. The importance of the company’s mission places it among the group of strategic enterprises for the Polish economy and the energy security of the country.
GAZ-SYSTEM S.A. operates on the basis of a licence issued by the President of the Energy Regulatory Office (ERO), which is valid until 2030 and gives the company the right to transport gas. In addition, the company performs the function of a transmission system operator and an independent operator of the Polish section of the Yamal Pipeline.
The company promotes the development of a competitive natural gas market in Poland and the optimisation of the domestic transmission network coupled with the expansion of cross-border connections within the European gas networks.
GAZ-SYSTEM S.A. operates from its head office located in Warsaw, at 4 Mszczonowska St, and its branches in Gdansk, Poznan, Rembelszczyzna, Tarnow, Swierklany and Wroclaw. From these locations the company provides its services all around the country. GAZ-SYSTEM S.A. also has its office in Brussels which represents its interests in front of EU institutions,and a subsidiary company Polskie LNG S.A. established for the construction and operation of the LNG Terminal. GAZ-SYSTEM S.A. is a joint-stock company wholly owned by the State Treasury. In 2011, there were no changes in the company’s ownership structure or form. In accordance with the “Energy Policy of Poland until 2030”, the Operating Lease Agreement came to its end in 2011 and, for the last time, the dividend from PGNiG S.A. was collected by the State Treasury in kind and transferred as a contribution to GAZ-SYSTEM S.A. As a result, comparing with the year 2010, the share capital increased by PLN 30,104,400 and currently amounts to PLN 3,771,990,842.
GDANSK
WARSAW
WROCLAW POZNAN
ANALYZED GAS PIPELINE POLAND-LITHUANIA LNG TERMINAL IN SWINOUJSCIE ANALYZED GAS PIPELINE BALTIC PIPE
ANALYZED GAS PIPELINE POLAND-SLOVAKIA Cieszyn
CONCEPTUAL STAGE PREPARATORY STAGE GAS PIPELINES IN PROGRESS
TRANSIT PIPELINE OF EUROPOL GAZ S.A.
REMBELSZCZYZNA
Lasow
TARNOW SWIERKLANY
ANALYZED GAS PIPELINE DEVELOPMENT POLAND-CZECH REPUBLIC
Gdansk
Branch
Tarnow
Branch
Swierklany
Branch
Wroclaw
Branch
Poznan
Branch
Rembelszczyzna
Branch
Key Stakeholders of GAZ-SYSTEM S.A.
In its stakeholder relations GAZ-SYSTEM S.A. strives to combine the economic value creation with a positive impact on its environment. The business strategy of the company defines the key stakeholder groups and takes into account the expectations of these groups in the process of making business, social and environmental decisions.
In the definition of its business strategy until 2020 the company identified the following stakeholder groups:
Membership in Organisations
GAZ-SYSTEM S.A. is a member of the following organisations: International industry organisations
Gas Transmission Europe Natural Gas STAR Program
The European Network of Transmission System Operators for Gas (ENTSOG) Gas Infrastructure Europe (GIE)
European Association for the Streamlining of Energy Exchange (EASEE-gas) Baltic Gas
Marcogaz
International Gas Union
Environmental Protection Agency
National industry organisations
Towarzystwo Rozwoju Infrastruktury “ProLinea” (Association for Infrastructure Development) Izba Gospodarcza Gazownictwa (Chamber of Natural Gas Industry)
Polskie Zrzeszenie Inzynierow i Technikow Sanitarnych (Polish Association of Sanitary Engineers and Technicians)
Stowarzyszenie Naukowo-Techniczne Inzynierow i Technikow Przemyslu Naftowego i Gazowniczego (Scientific and Technical Society of Oil and Gas Industry Engineers and Technicians)
Organizations promoting sustainable development
Global Compact
Forum Odpowiedzialnego Biznesu (Responsible Business Forum) (since 2012) Odpowiedzialna Energia (Responsible Energy) Initiative
CSR working party set up at the Ministry of Economy
Business organisations
Business Centre Club Local communities
– residents of communes where the company carries out its operations, including the landowners, users and leaseholders of the sites affected by the company’s investments Non-governmental organisations Trade union organisations Internal environment Market environment Social environment Shareholder Employees Subsidiary company Governmental administration and local authorities Gas market regulators Distribution and storage system operators Customers Business partners Financing institutions
National and international industry organisations
Media
Academic communities
Internal environment Market environment Social environment
Shareholder Governmental administration and
local authorities
Local communities – residents of communes where the company carries out its operations, including the landowners, users and leaseholders of the sites affected by the company’s investments Employees
Subsidiary company Gas market regulators
Trade union organisations Distribution and storage system operators
Customers Business partners
Financing institutions Non-governmental organisations National and international industry
organisations
Academic community
Services of GAZ-SYSTEM S.A.
The primary service provided by GAZ-SYSTEM S.A. consists of the transportation of natural gas from the entry points selected by the Shipper to the indicated exit points. In addition, the company may perform other services requested by customers, including:
• gas odorisation, i.e. saturation with a strongly odorous substance, • additional measurements related to gas transmission,
• operation, maintenance, repairs and projects carried out within the networks and installations
of the customer,
• suspension, reduction or restoration of deliveries to points in the system, at the request
of the customer.
Volume of gas transported to top 20 customers by industry sector in 2011 Total consumption:
4.4 bcm
Chemical 2.3 bcm Power 635.8 mmcm Metals 236.2 mmcm Minerals 226.7 mmcm Electric 25.9 mmcm9
28
14
16
77
67
GAZ-SYSTEM S.A. provides its services on the basis of the Transmission Network Code (TNC), which sets out the rules with respect to the provision and use of the gas transmission service. The TNC establishes detailed criteria of the safety of the gas system operation, which provide the guarantee of continuous and secure supply of the fuel to customers. The document also regulates the matters concerning the cooperation between the entities involved in gas transmission, and its scope covers the entire technical infrastructure operated by GAZ-SYSTEM S.A. As of 1 October 2011, the new updated Transmission Network Code has been in effect.
The customers connected directly to the network of GAZ-SYSTEM S.A. represent the chemical, fuel, energy, metals and mineral industries. Companies from the chemical and fuel sector are the largest gas customers. In connection with the European climate policy that supports low-emission power generation GAZ-SYSTEM S.A. has also noted considerable interest in the use of natural gas for fuelling power units.
Volume of gas transported to top 20 customers by industry sector in 2011.
2011 Services in Numbers
contracts for the provision of firm or interruptible gas transmission services
contracts for the provision of gas transmission services in connection with the additional capacity made available at the Lasow entry point
contracts for gas odorisation services
transmission network connection agreements
specifications of the conditions for connection to the network
“Our organisation needs to respond to challenges that may arise in the liberalised gas market by 2020, when the following advantages will count: optimised cost structure, flexibility and the ability to identify and react to the expectations of the market.”
Marcin Gronowski, Managing Director, Strategy Officer
SAFETY
Ensure safe operation of the transmission system as an element of the European gas pipeline network.
MARKET DEVELOPMENT
Create optimum conditions for the development of a liberalised natural gas market in Poland to enable increased consumption of natural gas as an environmentally friendly fuel.
EFFECTIVE MANAGEMENT
Ensure effective and sustainable improvement of the company’s operational and organisational performance.
EUROPEAN PARTNER
Build the position of
the company as a significant player in the natural gas market in the European Union, particularly
in the Central and Eastern Europe region.
SUSTAINABLE DEVELOPMENT
Manage the company from a sustainable development perspective.
Strategic Growth Directions of GAZ-SYSTEM S.A.
Business Strategy of GAZ-SYSTEM S.A.
In July 2011 the company adopted a new business strategy until 2020. The strategy was defined in a process that involved the representatives of all the organisational units of GAZ-SYSTEM S.A. During workshop meetings a detailed action plan was worked out around five pre-defined strategic directions that will set the path for the company’s growth in the coming years. As a result, a coherent strategy document was put together, which defines the company’s mission and vision, objective and concept, as well as the position GAZ-SYSTEM S.A. intends to achieve in the European market by 2020.
The responsibility for the coordination of the strategy definition and implementation activities has been delegated to the Strategy Officer appointed by the Management Board.
Mission
We ensure safe transportation of natural gas in Poland and are actively engaged in the creation of an integrated transmission system in Europe. In our day-to-day activities, we are committed to environmental stewardship and sustainable development.
Vision
Provide energy security and building the position of a major operator driving the integration of the transmission system in Europe through:
• the creation of conditions for the development of a competitive market in natural gas
in Poland, and the companies operating in the sector;
• the construction of interconnections with the transmission systems of the neighbouring
countries as part of the European gas networks.
Corporate Governance
Oversight over all the aspects of the company’s activities is provided by the Supervisory Board, which is composed on 3 to 9 members appointed by the General Meeting (i.e. the State Treasury), including one member elected from among the company’s employees (dependent member). The candidate for the Supervisory Board to be elected by the employees must not report directly to any of the Board members. The activities of the Supervisory Board are evaluated each year by the General Meeting (i.e. the State Treasury), which acknowledges the fulfilment of duties by the Supervisory Board and assesses the progress in the implementation of the business strategy, which includes the management from a sustainable development perspective as one of the dimensions. The Supervisory Board is currently composed of seven members, three of whom are women.
Jerzy Molak independent member, Chairman of the Supervisory Board,
does not have any function within the Management Board
Monika Kacprzyk-Wojdyga independent member, Deputy Chairperson of the
Supervisory Board
Włodzimierz Wolski dependent member, Secretary of the Supervisory Board
Agnieszka Godula independent member of the Supervisory Board
Zbigniew Marek independent member of the Supervisory Board
Jan Matuszewski independent member of the Supervisory Board
Katarzyna Ranc-Dobrzańska independent member of the Supervisory Board
The members of the Supervisory Board are entitled to monthly remuneration in the amount determined by the General Shareholder Meeting within the limits stipulated by the relevant regulations.
Wojciech Kowalski
Member
of the Management Board
Sławomir Śliwiński
Member
of the Management Board
Jan Chadam
President
of the Management Board
Wojciech Kowalski
Member of the Management Board, graduated from the Faculty of Mechanical Engineering of the Wroclaw University of Technology. He is a licensed construction engineer authorised to perform independent technical functions in construction industry. Mr Kowalski completed post-graduate programmes in gas industry at the Warsaw University of Technology, and in project management at the Warsaw School of Economics. He also attended specialist training courses in quality management, corporate finance and project profitability and risk assessment. He has been involved in the gas industry for over 25 years. After joining the Gas Engineering Office GAZOPROJEKT S.A. in 1986, in 1995 he was appointed President of GAZOPROJEKT S.A. initially responsible for technical, and subsequently for commercial matters. He has extensive experience in corporate management, industrial plant engineering, investment process management within the energy and gas sectors. In January 2009, he was appointed Member of the Board of GAZ-SYSTEM S.A., and since August 2011 Vice-President of the Management Board of Polskie LNG S.A.
Sławomir Śliwiński
Member of the Management Board, graduated from the Faculty of Law and Administration at the Nicolaus Copernicus University in Torun and completed a postgraduate program in gas distribution company management at the AGH University of Science and Technology in Krakow. He is a certified quality auditor qualified by the Polish Centre for Testing and Certification and the European Organization for Quality (EOQ) and received an MBA diploma in 2008. Mr Śliwiński was President of the Board at the Pomorska Spolka Gazownictwa Sp. z o.o. (a distribution system operator from the PGNiG Group). Prior to that, he worked for ZRUG Torun S.A. (engineering and construction contractor for gas industry), where he filled a number of positions including Quality Management Officer, Vice-President and President of the Management Board. In April 2009, he was appointed Member of the Board of GAZ-SYSTEM S.A.
The members are appointed by the Supervisory Board for a joint three-year term of office. In accor-dance with the provisions of the Articles of the company, in the selection of the candidates for the Management Board, the supervisory authority is required to take into regard their experience in ma-nagerial and supervisory positions or the relevant technical and professional qualifications, as appro-priate for the position to be filled in. The determination of the remuneration level and execution of agre-ements with members of the Management Board lies within the competences of the Supervisory Board. All dimensions of the Management Board’s activity are systematically evaluated by the Supervisory Board. Each year, based on the assessment of the performance of the Management Board, the Supervisory Board makes a recommendation to the General Meeting regarding the acknow-ledgement of the performance of duties by the Board Members. The company has appointed a Managing Director who is responsible for overseeing selected organisational units concerned with operating activity.
The day-to-day activities of the company are run by the Management Board. It is currently composed of three members:
Jan Chadam
President of the Management Board, Doctor of Philosophy in Economics. In the course of his career, he has held a host of executive positions, including Financial Director, Vice President and President of the Board at Pro Futuro S.A., Warsaw, Member of the Board at Elzab S.A., Zabrze, Financial Director at SIPMA Group, Lublin, President of the Board at SIP-MOT S.A., Zamosc and Director of Internal Audit Department at Polkomtel S.A. (Plus GSM cellular network operator). In February 2009 he was appointed Member of the Management Board at GAZ-SYSTEM S.A., and subsequently President of the Management Board as of July 2009. He has written several dozen domestically and internationally recognised publications on finance and management and has taught at several universities and MBA programmes.
Ethical Standards
With a view to ensuring the highest ethical standards, a Code of Ethics has been defined jointly by GAZ-SYSTEM S.A. and its employees. The document defines the rules of conduct and key values to drive the behaviour and decision making in the company.
Responsibility
Our actions are guided by responsibility towards stakeholders and the environment we operate in.
Commitment
We are fully committed to our activity – we appreciate the contribution of each employee to our present and future success.
Professionalism
We promote professionalism of our employees – we want to achieve our objectives through, above all, the continuous development of the knowledge and skills of our staff.
Teamwork
We believe that through cooperation we will be able to provide top quality services and therefore promote teamwork in our company. This demands that we are open to others and their ideas.
Respect
We treat our stakeholders with the utmost respect. We are always expected to exhibit the highest standards of integrity.
The principles set out in the code concern, among other things, the participation in public life and lobbying, hiring and treatment of employee family members, as well as the use of the company’s assets. The code also addresses the question of providing equal opportunities for professional development, presentation of employees’ world view and political convictions and the principles concerning the dress code in the workplace. Each employee has received a hard copy of the Code of Ethics while for other stakeholders it is available on our corporate website www.gaz-system.pl.
According to the provisions of the Code of Ethics, the company does not endorse nor provide any financial support for any political parties, organisations or movements, or any individuals engaged in political activities. For this reason, in 2011 GAZ-SYSTEM S.A. did not make any contributions, whether in cash or in kind, to any politicians or political parties.
Anti-Corruption and Anti-Fraud Policies
GAZ-SYSTEM S.A. has implemented anti-corruption procedures and policy. With respect to procurement, financial transactions, information confidentiality and IT security, control mechanisms are in place, which minimise the probability of the occurrence of any incidents. These regulation concern the entire company, including all the branches.
The solutions are monitored and continuously refined. In 2011, audits were held at three branches to assess the progress in the implementation of the audit of the anti-fraud controlling system and to review other operational and support functions, which did not reveal any corruption practices. Furthermore, the fraud risk is taken into account in the risk model of the company and is periodically re-assessed as a part of the risk management system (ERM – Enterprise Risk Management). There are communication channels in the company, which enable the reporting of any abuse (including potential incidents of corruption) and are accessible to all the employees. The method of abuse reporting has been described in the Code of Ethics. In addition, 4 persons (2 managers and 2 staff members) were trained on anti-corruption policies and procedures applicable in the company, which represents 0.2% of all the employees. Moreover, the Board Members and all the employees are obliged to observe the relevant procedures to avoid conflicts of interests and abuse, which are set out in the Compliance Programme of Gas Transmission Operator GAZ-SYSTEM S.A. The Compliance Programme defines the requirements for employees, which are intended to prevent any privileged treatment or discrimination of transmission system users.
Sustainable
Development
Responsible Investments
GAZ-SYSTEM S.A. executes its investment projects in a responsible manner, taking into account social, financial and environmental aspects, through:
• continuous environmental monitoring.
• building strong relations with local communities, based on long-term dialogue and open
communication.
number of meetings with local communities held by GAZ-SYSTEM S.A. in 2011 in connection with the investment projects implemented in different regions of Poland.
GAZ-SYSTEM S.A. takes care to ensure that all the investment projects are fully transparent and accepted by the local community and are implemented in conformity with the applicable legal regulations concerning environmental protection of and impact while offering an opportunity for growth in the region.
In those areas where operations are undertaken, communication campaigns are addressed to the citizens and representatives of the local authorities. Information is published on the company website (www.gaz-system.pl), in local newspapers and sent by mail to the landowners concerned. During public meetings GAZ-SYSTEM S.A. explains to the stakeholders the significance of the project for the region and the resulting benefits for the local communities. The expansion of transmission infrastructure will enable the transportation of larger gas volumes. This will contribute to the improvement of energy security of the region and the creation of additional capabilities for distribution network operators to develop gas supply and connect new customers. Another important aspect for the commune is the property tax payable annually by the investor in the amount of 2% of the value of the project located in the territory of the commune. These funds constitute an additional source of revenue for the commune and may support its development.
The construction of strategic gas pipelines is undertaken in accordance with the Act of 24 April 2009 on investment projects associated with the development of re-gasification terminal for liquefied natural gas in Swinoujscie. The Act provides for, among other things, simplified administrative and compensation procedures. GAZ-SYSTEM S.A. works together with provincial authorities to set an appropriate procedure for compensation payment. The level of compensation for expropriation is set based on an estimate prepared by a property valuer selected by the provincial governor in a tender process. Meanwhile, the award and level of compensation for restriction of the use of a property in connection with the establishment of a pipeline buffer zone, for the property occupation during the construction and for farming and other damage caused during the pipeline construction are subject to the decision of the provincial governor taken on the basis of assessments made after completion of the construction.
A systemic approach to communication related to investments is defined in the Promotion and Communication Manual for Projects Co-Financed Under the Operational Programme Infrastructure and Environment.
“The development of such a strategic project as the
construction of the Rembelszczyzna – Gustorzyn gas pipeline brings a lot of benefits for everyone involved. The Commune of Wieliszew is not an exception here. The 2% property tax for the pipeline section running through our territory, which the investor is due to pay each year, will be a major contribution to the communal budget. Thereby we will have funds for new investments. The quality of life will increase for all the residents. Once the project is completed, the landowners whose property is crossed by the pipeline will receive compensation which will certainly improve the standard of living for themselves and their families. Many of our residents will thus enjoy double benefits. Undoubtedly, the greatest benefit is the sheer fact that the investment will come into being, as it will significantly enhance the gas supply for the entire Poland. Therefore we should all consider ourselves winners.”
Paweł Kownacki, Head of the Commune of Wieliszew
45
Sustainable development, as the notion is understood by GAZ-SYSTEM S.A., means that in the course of its activities the firm strives to balance social, economic and environmental interests. Furthermore, sustainable development entails a certain responsibility the firm has toward its environment in connection with its business activity. Sustainable development is not only about taking care of the local communities but also of the natural environment in the areas where GAZ-SYSTEM S.A. develops its investment projects and operates gas pipelines.
Gas Pipeline Szczecin – Swinoujscie
In 2011, the construction of a strategic gas pipeline Szczecin – Swinoujscie was started. Its 80 km long route runs across protected areas, including: Wolin National Park, Olszanka Reserve and eight areas belonging to the Natura 2000 network. Thanks to appropriate changes to the construction engineering design, use of the latest technology and pipeline routing in parallel to the existing pipelines, the negative impact of the project on the natural environment has been minimised. In areas under nature conservation the works will be strictly limited to a reduced construction strip in order to mitigate any disturbance of habitats and species. The reclamation of the construction strip after the completion, including the restoration of the temporarily transplanted plants will mitigate the effects on the disturbed habitats.
Responsible Financing
In 2011, GAZ-SYSTEM S.A. continued its efforts to raise optimised and sustainable financing for the implementation of its investment programme until 2014 worth approx. PLN 8 billion. Project financing is largely based on internal cash generation (around 40%), subsidies from EU funds, loans from commercial bank and European financial institutions. In 2011, GAZ-SYSTEM S.A. signed an agreement with a consortium of commercial banks for the financing of its strategic investments. The company also finalised the negotiations with the European Investment Bank and continued to raise co-financing under EU funds. As a result, the company organised favourable financing on flexible terms for its investment programme. A substantial share of funds from European institutions in the total financing demonstrates that the investment projects of GAZ-SYSTEM S.A. successfully passed the assessment based on economic, financial, technical and environmental criteria. Moreover, from the investor’s perspective, these are the most attractive sources of financing available in the market. The optimised approach to financing, based on the cheapest sources of capital, was a priority for the company. Thanks to this, GAZ-SYSTEM S.A. can minimise its operating costs, which are reflected in the level of tariff for gas transmission.
Our responsible approach to investments also manifests itself in the care about the natural environment in every stage of the project. At the planning stage, the project location options and execution approaches are considered from the point of view of the expected environmental impacts. Before the construction begins, long-term observations known as wildlife inventories take place for several months to assess whether any of the following features occur within the range of the project impact:
• bird species and their habitats,
• natural habitats and habitats and sites of protected plant species, • amphibians and reptiles and their habitats,
• protected fungi and lichen species,
• protected mammal species and their habitats, • protected insect species and their habitats,
and to account for the impact of the project on the protected species and habitats identified along the route of the planned gas pipeline. When the interference is unavoidable, e.g. at watercourse crossings, trenchless techniques are used during pipeline laying. Besides, in wetlands, e.g. peat bogs, pipelines are laid in a drained trench without draining or the works take place in winter season so as to avoid draining of the adjacent land.
Examples of measures mitigating the adverse impact on the
environment caused by GAZ-SYSTEM S.A.
Gas Pipeline Polkowice – Zary
In order to minimise the adverse impact of the project on the environment, highest quality materials will be used during the planned construction of the Polkowice – Zary gas pipeline and the width of assembly strip will be reduced in forests and farming areas. With a view to protecting particularly valuable green areas trenchless techniques will be applied. The necessary tree removal will be carried out outside the nesting season.
As a result of the project financing obtained from EU funds and the negotiation of favourable terms of financing with commercial banks, as well as the structural changes in the company’s costs, the average charges for gas transmission to final customers could be reduced on a per unit basis. It was the second time in the course of five years that GAZ-SYSTEM S.A. reduced the rates for gas transmission.
GAZ-SYSTEM S.A. is the beneficiary of the following EU projects:
European Regional Development Fund – ERDF
(Operational Programme Infrastructure and Environment 2007-2013)
The company obtained co-financing under ERDF in the amount of nearly PLN 0.8 billion for the construction of the following pipelines: Szczecin – Gdansk, Rembelszczyzna – Gustorzyn, Wloclawek – Gdynia, Szczecin – Lwowek, Gustorzyn – Odolanow, Jeleniow – Dziwiszow and Polkowice – Zary.
European Energy Programme for Recovery (EEPR)
The company obtained financing under EEPR in the amount of PLN 0.3 billion for the construction of the gas pipeline Swinoujscie - Szczecin and the gas compressor station in Goleniow, as well as the construction of gas pipelines in Lower Silesia and the interconnector Poland – Czech Republic;
Trans-European Networks-Energy
The company obtained co-financing for pre-investment studies related to the construction of the Baltic Pipe in the amount of 4.31 million Euro;
European Regional Development Fund – ERDF (Operational Programme Innovative Economy 2007-2013)
The company obtained co-financing in the full amount of PLN 0.6 million for the construction of a gas meter calibration laboratory at the gas compressor station in Holowczyce.
“GAZ-SYSTEM S.A. is one of the major beneficiaries of EU funds under the European Regional Development Fund. It is worth noting that the financial framework 2007-2013 was the first one when Poland, as a Member State, obtained support for projects in energy sector. Thereby we are jointly gaining valuable experience in the implementation of projects co-financed by the EU. The European Funds Centre for the Energy Sector was set up within the organisational structure of the Oil and Gas Institute as the Implementing Authority for the European Regional Development Fund in the energy sector. In 2011, GAZ-SYSTEM S.A. completed the gas pipeline Wloclawek – Gdynia which was the first project to obtain co-financing under the programme. We are currently taking measures to ensure that the settlement of subsequent projects is smoothly carried out in the following year.”
Prof Maria Ciechanowska, Director of the Oil and Gas Institute
3.2 bn equity 1.7 bn commercial banks (consortium) 1.2 bn ERDF (OPIE) 0.5 bn EEPR – EU 0.6 bn EIB – gas pipelines 0.6 bn EIB – LNG Terminal 0.2 bn PKO BP
Sources of financing for the PLN 8 bn Investment Programme of GAZ-SYSTEM S.A. in years 2011-2014
Men represent the majority in the personnel structure, which is related to the nature of the company’s operations and jobs performed. Despite this, all the employees are afforded equal treatment and enjoy the same right of access to all the benefits and positions.
The majority of the personnel in GAZ-SYSTEM S.A. are employed under full-time employment contracts for an indefinite term. Detailed employment structure by type and term of employment contract is presented in the following tables.
Responsible Workplace
The responsible approach of GAZ-SYSTEM S.A. to human resources management is reflected in the definition of transparent rules with respect to e.g. hiring, employment, promotion and professional development of the employees.
At the end of 2011, the company employed 2152 persons. The employment structure by branch is shown in the following table.
Total number of employees according to the type of employment contract, position and region, broken down by gender
Total number of employees with employment contract, by gender: 2152
Men 1611
Women 541
Number of supervised personnel, by gender: 120
Men 95
Women 25
Number of employees by region, according to administrative division based on the activity scope of the unit
Head Office 336 Gdansk 169 Poznan 251 Wroclaw 276 Swierklany 220 Rembelszczyzna 313 Tarnow 587
Employees with employment contracts, of which: 2152
Full-time employees, of which: 2144
Men 1605
Women 539
Part-time employees, of which: 8
Men 6
Women 2
Employees with indefinite term contracts, of which: 2084
Men 1568
Women 516
Employees with definite term contracts, of which: 68
Men 43
Women 25
Employees with short-term contracts, of which: 29
Men 10
Women 19
Employees with contracts for a specific task, of which: 8
Men 7
Women fill in a quarter of managerial positions in GAZ-SYSTEM S.A.
Managerial positions, of which: 48
Men 36
Women 12
Currently, the company employs only Polish nationals. The demographic structure of the employees of GAZ-SYSTEM S.A. is presented in the following table.
Percentage of employees by age
Age below 30 9.27% 203 Men 60.1% 122 Women 39.9% 81 Age 30-50 56.51% 1237 Men 73.4% 908 Women 26.6% 329 Age over 50 34.22% 749 Men 79.8% 598 Women 20.2% 151
Employees of 30-50 years of age represent the majority (56.51%), followed by staff members over 50 years of age (34.22%), while the personnel aged below 30 accounts for 9.27% of the total workforce. In the reporting period, all the senior managers employed by the company were locally hired from the Polish labour market. All the employees, regardless of their working time and type of contract are covered by the Collective Labour Agreement of 8 March 2007. The document sets forth the employee entitlements under the generally applicable labour regulations and additional benefits offered by the company. Any matters concerning employment and major organisational changes are subject to consultations with social partners.
GAZ-SYSTEM S.A. guarantees the freedom of association for its employees. There are three union organisations within the company, which engage in the dialogue with the employer and take part in shaping the HR policy. In accordance with the applicable laws and regulations GAZ-SYSTEM S.A. does not employ any children or minors under 18 years of age, and does not use any forced or compulsory labour. Despite all the reasonable efforts used by the company to prevent discrimination,
two incidents of this kind were identified in the organisation in 2011. These occurrences were investigated, a corrective action was taken and its results were reviewed in an internal process. In 2011, GAZ-SYSTEM S.A. did not hold any training for newly hired security personnel as regards the polices or procedures concerning aspects of human rights addressed in the company’s Code of Ethics, but they were provided with the opportunity to review the contents of the Code using the corporate intranet site. The company plans to organise such training during the coming year.
Remuneration and Benefits
The remuneration principles of the company are set out in the Collective Labour Agreement. In 2011, the average salary was higher for women than for men. In this comparison, only women in senior management and among administration professionals are paid less than their male counterparts. The ratio of basic salary of women to men is illustrated by the following table.
Ratio of basic salary of women to men, by level of the position within the organisational hierarchy:
Senior management 93%
Middle management 123%
Specialist positions (employees performing specific industry-related tasks 100%
Administration professionals (e.g. HR, accounting) 98%
Technical positions 104%
Responsible workplace also means that fair remuneration is offered to the employees in the lowest-level positions. The ratio of the salary lowest-level of these employees to the minimum market wage at 240% for men and 267% for women (assuming the 2011 minimum wage level of PLN 1386). The minimum wage is independent of the location or the employee’s gender. Its levels applicable to individual positions were determined in the Collective Labour Agreement.
Each employee of GAZ-SYSTEM S.A. has access to free healthcare services outside the public system, including comprehensive specialist consultations, examinations and diagnostics. The healthcare package is also available to employee families and retired employees. The employees are also covered by a group life insurance including the risk of disability or incapacity for work. In response to the expectations of the employees, a Pension Scheme was launched at GAZ-SYSTEM S.A., which has been joined by over 70% of the company’s employees.
The personnel of GAZ-SYSTEM S.A. have a guaranteed social package, which covers a partial or full reimbursement of the costs of holidays, sports and leisure activities, cultural and educational events or support in case of accidents.
In addition, the company offers other employee benefits beyond the scope required under the generally applicable regulations. Among other things, the employees may expect the following:
• a day off work falling on the Saint Barbara’s Day (except for Saturdays and Sundays)
and a financial bonus on this occasion.
• extra financial benefits such as: profit sharing bonus, discretionary bonus or jubilee bonus, awarded
in accordance with the current Collective Labour Agreement,
• two extra days of holiday (for employees with at least 15-year tenure in the industry), • extra sickness compensation for employees with at least 10-year tenure in the industry.
Return to Work After Parental Leave
The responsibility of GAZ-SYSTEM S.A. for the employees also entails the guarantee of return to work for parents who take advantage of parental leave. Most women return to work in their original position and remain with the organisation for at least 12 months to follow.
Number of persons in parental leave in 2011, of which: 61
Women 29
Men 32
Women in child care leave 3
Number of women who returned to work after maternity leave 16
Number of women who returned to work after maternity leave and continued to work until the end of the reporting period
16
Number of men who returned to work after paternity leave 28
Number of men who returned to work after paternity leave and continued to work until the end of the reporting period
27
Employee Development
The professional development of personnel is one of the key objectives of the human resources policy. The principles regulating the access to training are set out in the Rules for Professional Qualifications Improvement of the Employees of Gas Transmission Operator GAZ-SYSTEM S.A.
The employees of GAZ-SYSTEM S.A. take part in mandatory training programmes, professional development courses, competency building sessions, workshops, language courses, as well as university studies including post-graduate and MBA programmes. The employer also sponsors the participation in industry conferences, both domestically and abroad. The employees who improve their qualifications take advantage of training leave in accordance with the amended regulations of the Labour Code. In 2011, the total amount spent on training by the company reached PLN 4.9 million.
Some training programmes are delivered internally. Since 2011 they include training on integrated management system and occupational health and safety.
Detailed figures showing number of training hours per employee broken down by workforce structure are provided in the following table:
Average hours of training during the year per employee, by gender and employment structure
Total hours of training annually per employee:
Women 30.38
Men 22.83
Senior management (directors and higher levels) 75.55 Directors and deputy directors
Middle management (managers) 28.68 Managers, deputy
managers, foremen Professional functions (employees performing specialised
tasks, e.g. environmental)
25.48 Employees of technical, operating, investment units, etc.
Administration functions (e.g. HR, accounting) 26.52 Employees in positions not related to operation
Technical positions 17.63 Employees in operational
positions
In 2011, as the definition of the new procedure was still in progress, the employees did not undergo any regular assessment of the quality of their work or a carrier development review.
Newly Hired Employees
Prestigious awards received by GAZ-SYSTEM S.A. as a reliable employer, as well as positive perceptions of the employees have been attracting an ever-increasing number of job applications. The principles and methods of recruitment and selection of candidates for hire are set out in the Recruitment Procedure. The document guarantees equal rights of the candidates and prevents any discriminatory practices, as it is based on the assessment of the candidates’ predispositions, qualifications and professional experience. The package offered to newly hired employees is an example of good practice and includes:
• orientation manual for new employees – a comprehensive guide on the corporate culture, rules
and other information necessary for effective functioning within the company,
• the Code of Ethics and brochure Our Values,
• information booklet Strategy of GAZ-SYSTEM S.A. until 2020.
The structure of the employees hired in 2011 is presented in the following table.
Total number of employees hired by the company in the reporting period, of which: 115
Women 45 Men 70 Age below 30 43 Age 30-50 64 Age over 50 8 Rural residents 18 Urban residents 97
Percentage of employees hired in the reporting period, of which: 5.3%
Women 39.1% Men 60.9% Age below 30 37.4% Age 30-50 55.6% Age over 50 7.0% Rural residents 15.7% Urban residents 84.3%
Turnover
High level of employee satisfaction means that those who decide to leave the company represent only a small percentage of the workforce. Detailed figures showing the number of leaves in different age groups taking into account gender and place of residence are provided in the following tables.
Total number of employees who left the company in the reporting period, of which: 38 Women 5 Men 33 Age below 30 3 Age 30-50 18 Age over 50 17 Rural residents 2 Urban residents 36
Percentage of employees who left the company in the reporting period, of which: 1.8% Women 13.2% Men 86.8% Age below 30 7.9% Age 30-50 47.4% Age over 50 44.7% Rural residents 5.3% Urban residents 94.7%
Occupational Health and Safety
Recognising that due to the nature of the company’s operations some employees may be especially exposed to the risk of accident or certain diseases, GAZ-SYSTEM S.A. adheres to the highest standards of occupational health and safety. In order to mitigate the risk of accident occurrence, employees undergo training on occupational health and safety and job hazard analysis is performed for every position. In addition, the company has established a safety management system and appropriate procedures to provide aid and minimise any hazards to employee health and life. With a view to en-suring safe and healthy working conditions and the protection of employee rights set out in the appli-cable labour regulations, a Social Labour Inspector has been appointed at the company.
The questions of employee safety is also addressed in the agreements with trade unions, which include provisions concerning personal protective equipment, joint health and safety committees composed of the management and employees, training, complaint reporting mechanisms, periodic health and safety inspections, right to refuse the performance of dangerous job, participation of employee repre-sentatives in health and safety inspections and audits and in accident investigations. GAZ-SYSTEM S.A. not only cares about the safety of its own personnel but also about the employees of the suppliers and subcontractors engaged in the projects implemented by the company. The company organises dedicated seminars for them, concerning health, safety and environmental aspects pertinent to the performance of jobs involving a gas hazard.
In March 2011, GAZ-SYSTEM S.A. was admitted to the Forum of Work Safety Leaders. The company went through a review of its performance in respect of safety and human protection in the wor-king environment, which was carried out by a special committee established at the Central Labour Protection Institute – National Research Institute.
Furthermore, GAZ-SYSTEM S.A. gets involved in educational events related to the issues of occupa-tional safety. The company joined the “Safe Workplace” initiative and as a part of this initiative orga-nised a national conference on “Safe Workplace in Explosion Hazard Zones”, which was addressed primarily to gas industry operators, as well as an art competition for children of the employees of GAZ-SYSTEM S.A. “How do I imagine the safe workplace of my Mum/my Dad”. In addition, the compa-ny became a partner of a social campaign called ”Prevent Accidents”. The campaign activities con-sisted principally in the promotion of good practices in cooperation with contractors, improvement of knowledge on accident prevention, development of safety awareness among employees, as well as the dissemination of guidelines for safe working at heights.
Owing to the approach of GAZ-SYSTEM S.A. to personnel safety issues, the number of incidents representing a risk to employee health or life is very low. In the reporting period, no severe, group or fatal accidents occurred. All the reported incidents were related to employee movement.
Rates of injury, occupational diseases, lost days and absenteeism of the employees of the organisation in the reporting period, by gender:
Total number of accidents at work, of which: 3
Women 0
Men 3
a) number of fatal, group and severe accidents 0
Women 0
Men 0
b) Total days of incapacity for work due to accidents at work 154
Women 0
Men 154
c) Accident frequency rate* 1.4
Women 0
Men 1.4
d) Accident severity rate 51.3
Women 0
Men 51.3
e) Number of diagnosed occupational diseases 0
Women 0
Men 0
Total number of contractor accidents, during the performance of services for the company
0
Women 0
Men 0
a) number of fatal, group and severe accidents 0
Women 0
Men 0
*Total accidents/headcount x 1000
GAZ-SYSTEM S.A. has systems for tracking and reporting accident statistics, include:
System name Description
Register of accidents at work Procedure ZB-01 for the investigation of the circumstances and causes of accidents at work and potential accident hazards Monthly update on accidents at work Information for employees on reported
occurrences and accidents distributed through the intranet (Health and Safety section)
Best Employer 2011
In 2011, GAZ-SYSTEM was ranked as the second in Poland and first in Central and Eastern Europe in large employers category of the Best Employers Study 2011. Our rating was 39% higher than the sector average and 6% higher than the Best Employers average.
As a result of our strategic approach to create a friendly work environment, we managed to increase our employees’ job satisfaction and commitment levels. According to a study conducted by the international consulting company Aon Hewitt, the GAZ-SYSTEM’s employee commitment score reached 80% in 2011. It means that the majority of our employees has a positive view of the company and the company image is consistent with their work experience within the organisation. Furthermore, 71% of our employees declare that the company values are similar to the ones they abide by in their private lives.
Employee commitment score (average sample – 895 employees)
28% 67% 73%
Responsible Partner
The company engages in various community oriented initiatives. One of the projects in this area is a grant competition known as the Natural Energy Fund, whose key objective is to co-finance the best regional environmental protection ideas. The first edition of the competition yielded 23 entries and the top 5 projects received financial grants totalling PLN 50 thousand.
Winning Projects
• Patrolling Squads: a project put forward by the Special
Education and Childcare Centre in Nowogard.
• Healing the Chestnut Trees: project by the School Complex
in Lubiana.
• Educational Trail: a project proposed by the Primary School
in Czaplinek.
• The World is Waiting for Green People: a project prepared
by the Janusz Korczak Primary School in Gostomia.
• Live actively but economically: a project submitted by
the Władysław Szafer Primary School No. 2 in Wapnica. Detailed descriptions of the above projects are available on
www.gazsystemdlanatury.pl GAZ SYSTEM also operates a school kit programme, under which 815 first formers received school bags
and fully stocked pencil cases in 2011. Since the launch of the initiative, the company has presented school kits to 1400 children across Poland.
The above described projects are aimed at fostering positive relations with local community representatives.
As part of GAZ-SYSTEM’s educational initiatives, we have continued our cooperation with the AGH University of Science and Technology in Krakow. Thanks to our efforts the Faculty of Drilling, Oil and Gas and the Faculty of Energy and Fuels were equipped with the latest version of SIMONE software for monitoring transmission system operation. The practical use of the simulator in gas industry was presented in a lecture given by a specialist from GAZ-SYSTEM’s Gas Dispatch Centre.
In 2011, the company supported over
90
community projects. The beneficiaries includedGAZ-SYSTEM’s sponsoring activity is based on cohesion, transparency, effectiveness and responsibility. In this regard, the activities of the company are regulated by internal Sponsorship Guidelines and the annually updated Sponsorship Plan. Areas of sponsorship include: environmental initiatives, research, education and sports. Our sponsorship activity is carried out on a national and local, rather than international scale. Each sponsorship project is evaluated in terms of company image, media reception, brand improvement and company value growth.
In our sponsorship activity at GAZ-SYSTEM, we follow the guidelines of Regulation No 5 of the Minister of State Treasury of 13 February 2009 concerning principles of sponsorship activity conducted by companies with State Treasury participation, as well as the principles of Global Compact. Our responsible and transparent performance meant that no inconsistencies with national law or internal marketing communication (incl. sponsoring) documents were found in the reporting period. In 2011, GAZ-SYSTEM made 10 donations for the total amount of PLN 80,500.
Awards
Our strategy to raise investment standards, maintain excellent employment conditions and foster dialogue with our business partners continued to win us multiple awards and recognition.
In 2011 GAZ-SYSTEM S.A. received the following awards: Main award in the category Investment of the Year 2011
for the Goleniow compressor station in the Marshal of the West Pomeranian Provincial Business Competition
2011 Investor of the Year award
presented at the Energy World Leaders Gala of the 14th International Energy Conference EUROPOWER 2011
Investor of the Year for Central and Eastern Europe title
at the 4th Investment Forum in Tarnow
The 2011 Seahorse Statuette
GAZ-SYSTEM S.A. received the annual business award bestowed by Business Club Szczecin for the Swinoujscie LNG Terminal construction as the largest infrastructure investment project in Western Pomerania;
European Medal for gas transmission services
awarded by Business Centre Club, under an programme operated with the support of the Ministry of International Affairs and under the honorary patronage of the European Economic and Social Committee
Innovation Certificate
a prestigious award bestowed by the Institute of Economics of the Polish Academy of Sciences and the International Research Network to projects marked by exceptional market and process innovation, expenditure on innovation, innovative patent solutions and European contracts
Best Employer of the Year 2011, 2nd place large employers category
Best Employer of the Year 2011, 1st place in the Central and Eastern Europe ranking
Gas Pipeline Wloclawek – Gdynia
Will improve security of gas transmission in the Pomerania region, offer increased gas transportation capacity and create conditions for gas market development in the area. The completion of a 64-kilometre long section of this high-pressure gas pipeline was the final stage of the project and enables full utilisation of the 252-kilometre long pipeline.
The projects completed by GAZ-SYSTEM S.A. in 2011, along with the introduction of a virtual reverse flow service for the Yamal pipeline, resulted in the increase of technical capacity of the import entry points to the gas grid in Poland of over 3.3 bcm of gas annually (approx. 30% of the current import volume).
As a company of strategic importance for the Polish economy, GAZ-SYSTEM S.A. is responsible for ensuring the security of gas supply and efficient operation of the transmission network. Reliable and safe transportation of gas to customers requires investments in the development and moderni-sation of transmission infrastructure. Therefore, the company is taking active measures to ensure that individual infrastructure components are integrated into a single transmission system in Poland and Europe. By 2014, the company plans to commission around 1000 km of new pipelines. The development of the domestic transmission network and the construction of new interconnectors will enable GAZ-SYSTEM S.A. to become a major integrator on the European gas market, while contributing to the improvement of EU energy security.
Investment projects completed in 2011
Commissioning of a new Polish-Czech gas interconnector
It provides the capacity of around 0.5 bcm of gas per annum and guarantees enhanced security of gas supply for the Central European region. The interconnection is the first point linking the Polish gas system with the European transmission network in the south of Poland. In case of increased market interest, the capacity of the interconnection may be increased significantly.
Expansion and upgrading of the transportation system in Lower Silesia
The investments projects in the region included the construction of the following gas pipelines: Jeleniow node – Jeleniow compressor station, Taczalin – Radakowice, Radakowice – Galow, upgrading of gas pipeline Dziwiszow – Taczalin and capacity expansion of the point in Lasow. With the system expansion in Lower Silesia, the transmission capacity from the western direction increased by approx. 0.5 bcm per annum, up to 1.5 bcm per annum. At the same time, it enhanced the interoperability with the Underground Gas Storage (UGS) facility in Wierzchowice.
Commissioning of Jaroslaw II Gas Compressor Station
The facility serves for the compressing of gas imported from Ukraine through the Drozdowicze – Hermanowice node and produced from domestic fields located in the vicinity of Jaroslaw and Przemysl, which makes it one of key components of the Polish transmission system. The nominal capacity of the new compressor station Jaroslaw II is 300 mcm/h.
Gas Compressor Station in Goleniow
Will enable the development of gas supply in the region and the transportation of increased gas volumes originating from the LNG Terminal in Swinoujscie to the domestic transmission network.
3.3
bcm
0.5 bcm
Poland – Germany
0.5 bcm
Poland – Czech Republic
2.3 bcm
virtual reverse flow service
for the Yamal pipeline
increase of technical
capacity of the import
entry points to the gas
grid in Poland
Cross-border Interconnections
Cross-border interconnections play a major role for energy security, as they not only enable the diversification of natural gas supply but also improve the stability of the system while reducing the dependence of Poland on gas
