Saturday, April 20, 2024
HomeOil & GasORLEN finalises merger with PGNiG - becoming the largest energy company in...
Powered by

ORLEN finalises merger with PGNiG – becoming the largest energy company in CEE

The Polish ORLEN Group has finalised the merger with leading oil and gas company, PGNiG, becoming the largest fuel and energy group in Central Europe. In terms of revenue, it now joins the top 150 companies in the world, serving over 100 million customers.

Following the merger with PGNiG, the Orlen Group has the potential to implement multi-billion investments, which can play a key role in strengthening the energy security and independence of Central Europe.

“This is a historic moment. We took up the challenge of merging companies that are strategic for energy security and successfully completed this difficult and demanding process. We already operate as one combined ORLEN Group,” said the President of the Management Board of PKN ORLEN, Daniel Obajtek. “Together, we are building the future, the foundation of which will be the development of promising areas of activity, ensuring the security and stability of energy supplies for Poles. At the same time, we are starting the integration of the entire Group, as our ambition is to develop the entire ORLEN company towards a modern concern that will drive the Polish economy in difficult times. The company with annual revenues of around 400 billion zloty [85.2 billion euros] is also becoming more attractive to trading partners, including oil and gas producers, which we can already see and use in our day-to-day operations.”

The merged companies will aim to utilise the potential of the current business lines, as well as strengthen strategic development projects. ORLEN intends to become heavily involved in the development of low- and zero-emission generation sources, becoming one of the leading producers of green energy in the region. 

“The potential and assets of PGNiG significantly strengthen the ORLEN Group, which will be of key importance for the development of the fuel and energy sector,” added Iwona Waksmundzka-Olejniczak, President of the Management Board of PGNiG. “Only a strong entity with diversified areas of activity can effectively meet the challenges of the energy transformation, and the key to success is the implementation of investments that will translate into the development of the Polish economy and strengthen our energy security.”

“The integration of companies serves to achieve synergy and, above all, to strengthen the areas of their current activity,” she continued. “PGNiG employees will be fully involved in the process of building the value of the new capital group. They will support the development of competence centres with their experience and knowledge, in particular in the field of hydrocarbon exploration and production, gas distribution and storage as well as heat and electricity generation.”

According to PKN Orlen’s press release, the merger will enable the Group to “more efficiently” achieve its goals set by the ORLEN Group in 2020, implementing the new development strategy. In particular, the merger will increase the chances of achieving carbon neutrality by 2050, an ambition that shapes the strategic directions of development. 

In addition, the completion of the merger process will enable the acceleration of ongoing investments, such as the construction of offshore wind farms and photovoltaic farms, the development of hydrogen projects – including green hydrogen, or the construction of small modular nuclear reactors. Consequently, reducing emissions from the existing heat and power plants. The competencies and resources of each of the ORLEN Group companies will be used to implement these activities.

The press release adds that the ORLEN Group now has a scale of operations and stability that will strengthen its resilience to the ongoing market changes. In particular, the diversification of activities will allow for the stabilisation of financial flows, which will benefit both shareholders and customers of the merged entities. Greater stability also increases the possibility of obtaining financing on international markets. These new developments are also expected to strengthen the Group’s bargaining position in building a portfolio of crude oil and natural gas supplies to Poland.

The merger will also provide new opportunities for the Group’s assets and transformation of business segments. In the area of exploration and production, the consolidation of the assets of ORLEN, LOTOS and PGNiG will improve operational efficiency and enable increased investment and focus on natural gas and crude oil deposits in Poland and Europe, as well as other promising regions.

In August, the ORLEN Group finalised its merger with the Polish oil company, LOTOS.

Sign up for our newsletters

    Monthly newsletter – Delivering the most important energy stories of the month selected by our Editor-in-chief
    Weekly Oil&Gas roundup - All major news about the oil and gas industry, LNG developments, the upscaling of new gases and related EU regulations arriving in your mailbox every Monday.
    Weekly Renewables&Climate roundup - All major news about investments in renewable energy sources, environment protection, green hydrogen and new innovative ways to tackle the climate crisis arriving in your mailbox every Tuesday.

    Most Popular