Page 6 - EurOil Week 24 2021

EurOil COMMENTARY EurOil

PKN Orlen bulks up to play

in the big league

The tie-up that will create a national energy champion

is due to be completed later this year

POLAND OIL and gas giant PKN Orlen, already Poland’s Polish state control over the company – with all
biggest company by revenues, is being built up by side effects that come with it and which have
the country’s radical rightwing government to be become glaring since the rightwing coalition
a national champion fit to play in the same league government, led by the Law and Justice (PiS)
as Austria’s OMV and Spain’s Repsol. party took over power in 2015.
At the same time, Orlen will have to play a The PiS-led government has handpicked the
major role in the country’s belated and pro- company to be the core around which other state
tracted drive to meet the European Union’s goal companies are being integrated. The end goal is
to be carbon-neutral by 2050. the creation of a state-controlled energy giant,
“We are creating an integrated and diversified which Orlen will lead after taking over Poland’s
fuel and energy company based on the strengths other, smaller, refiner, Lotos, and oil and gas
of each [participating] company that will be exploration and production company PGNiG.
capable of facing the challenges of energy trans- Orlen had earlier also taken over the power com-
formation and international competition,” PKN pany Enea.
Orlen’s CEO Daniel Obajtek has said. Once the integration of Lotos and PGNiG is
Typically for an integrated oil and gas com- completed, which is expected late this year, Fitch
pany, PKN Orlen does pretty much everything Ratings said that this would be credit positive
along the hydrocarbons’ value chain: from explo- for Orlen, as it will benefit from “larger scale,
ration and production to refining and retail- stronger business diversification and expansion
ing fuels and other oil-based products. PKN into the more stable utility sector.”
Orlen’s revenue in 2020 came in at PLN86.2bn Like other companies in the global field of
(€19.33bn) – down 22.3% versus 2019, its net oil and gas, Orlen, too, is aware of the challenges
profit PLN3.4bn, a reduction of 20.9%. that the decarbonisation of the energy sector is
The Warsaw-listed refiner is 27.52% con- to bring about. Global majors are already feel-
trolled by the Polish Treasury, which gives the ing the heat, with a group of dissident directors

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