August 14, 2017 - Poland's biggest power producer PGE expects coal prices to rise next year due to declining supplies, the company's Chief Financial Officer Emil Wojtowicz said on Wednesday.

State-run PGE generates most of its electricity from lignite and thermal coal. It produces lignite in its own mines and buys thermal coal mostly from Poland's biggest miner PGG, which it helped to bail out last year.

In the second quarter of 2017 thermal coal prices rose by 3 percent year on year, PGE said quoting data provided by a state-run industry agency ARP.

"We think that, because of the smaller number of suppliers, the coal prices could go up a bit and we are not the only ones to assume so," Wojtowicz told a conference.

Earlier this year PGG agreed to take over its smaller troubled rival KHW, also with the help of PGE and other state-run utilities.

PGE Chief Executive Henryk Baranowski told the conference the group sees no problems with coal supplies from PGG, adding that PGE's lignite coal resources in Belchatow, central Poland, where its 858 MW lignite-fuelled power plant is, will run out by 2035 and the company will have to decide on investment in new pitches around 2025.