PGNiG Upstream Norway AS (PUN), a company of the ORLEN Group, has signed an agreement with Wintershall Dea Norge AS for the swap of interests in upstream assets in Norway. PUN will acquire an interest in the Idun Nord field and expand its holdings in the Adriana and Sabina discoveries. In exchange, it will transfer a minor part of its interest in the Ærfugl Nord field to Wintershall Dea. The transaction will increase PUN's recoverable reserves of natural gas of by more than 0.4 billion cubic meters. The asset swap is anticipated to optimise the company’s portfolio of licence interests in the Skarv area, translating into improved efficiency and lower overall cost of managing these assets.
As early as next year, almost two-thirds of the gas produced by ORLEN Group on the Norwegian Continental Shelf will come from facilities powered by renewable energy produced onshore and delivered with submarine power cables. Such a solution has already been applied to the platforms at the Gina Krog, Ormen Lange, and Duva fields and will result in the abatement of over 88,000 tonnes of CO2 in 2024. There are also plans to electrify the Fenris and Yggdrasil fields, which are currently under development.
ORLEN has unveiled its Sustainable Development Strategy for 2024–2030. The document outlines the organisation’s strategy and goals for minimising climate impact, promoting environmental stewardship, enhancing working conditions, fostering local community engagement, and embracing responsible governance. A significant element of the strategy is the Just Transition Programme for local communities in transition-impacted areas. The implementation of the ESG objectives is poised to enhance the ORLEN Group’s competitive standing, mitigate business risks, and foster the sustained creation of shareholder value.
The marine terminal for the transshipment of carbon dioxide, a joint venture between ORLEN, Lafarge Cement S.A. and Air Liquide Poland, has received a European Commission grant for the preparation of project design documentation and supply chain feasibility studies. The construction of the terminal aligns with the Group’s strategic goals of reducing its own CO2 emissions and facilitating the provision of carbon management services to companies relying on CO2 capture and sequestration as the primary technology for emission reduction. Between 2027 and 2030, ORLEN aims to have the capacity to utilise or sequester 3 million tonnes of CO2 per year.
PGNiG Upstream Norway of the ORLEN Group has signed an agreement with Horiosnt Energi AS to acquire a 50% interest in the CO2 exploration licence Polaris in the Barents Sea. The transaction marks a significant step in advancing the Group’s emerging business line focused on the management of industrial CO2 emissions. Polaris stands out as one of the most advanced carbon storage projects on the Norwegian Continental Shelf.
The testing phase for the 1MW prototype cogeneration set featuring the Multifuel system, which enables electricity and heat generation using hydrogen, natural gas or their mixtures, has been successfully completed. The prototype stands out on a global scale, employing a proprietary solution developed by ORLEN. The Multifuel system can be installed in generating units that are already in operation, allowing them to be gradually converted to run on hydrogen. Multifuel is set to expedite the adoption of alternative fuels in the power industry, contributing to the reduction of CO2 emissions in the sector. ORLEN has filed a patent application for its invention.
PGNiG Upstream Norway, a company of the ORLEN Group, is set to assume control of the entire operations of the hydrocarbon producer KUFPEC Norway. Following this transaction, the ORLEN Group's natural gas output in Norway will increase by one-third, reaching over 4 billion cubic meters (bcm) annually. Daily hydrocarbon production is anticipated to surpass 100 thousand barrels of oil equivalent (boe) by the end of 2024. The newly acquired business encompasses interests in five fields where the ORLEN Group is already active. The gas produced from these fields will be transported to Poland via the Baltic Pipe pipeline.
Together with concession partners, PGNiG Upstream Norway from ORLEN Group has discovered additional gas reserves near the producing Gina Krog field. The discovered additional resources (gross) are estimated to 0.8-2.6 million cubic meters oil equivalents. By using the existing production infrastructure, it will be possible to start exploitation of the new resources later this year.
In the three months ended September 30th 2023, the ORLEN Group generated LIFO-based EBITDA of PLN 8.2bn and net profit of PLN 3.5bn. This means that on a year-to-date basis, for the first nine months of 2003, the Group’s operating profit reached PLN 34bn and net profit was more than PLN 17bn. In the third quarter of 2023, despite macroeconomic headwinds, the Refining segment contributed positively to the Group’s performance, posting LIFO-based EBITDA of PLN 1.9bn. The contribution from Petrochemicals was negative, which was due to lower demand for petrochemical products. In the Retail segment, ORLEN reported improved sales volumes in the third quarter. In the Polish market alone, they expanded by 9% year on year. The Group’s financial ratios were maintained at safe levels, with PLN 20.4bn allocated to capital expenditures during the nine months to September 30th.
‘Saint Barbara’ and ‘Ignacy Łukasiewicz’ are the new additions soon to join the ORLEN Group’s fleet of liquefied natural gas (LNG) vessels. The ship naming ceremony took place at the Hyundai Samho Heavy Industries shipyard in Mokpo, South Korea. Slated to commence sea service by the end of this year, the new vessels are set to bolster the ORLEN Group’s capacity for natural gas procurement and thus enhance Poland’s energy security.
The ORLEN Group's susidiary, PGNiG Upstream Norway has commenced production from the Tommeliten A field on the Norwegian Continental Shelf. It will provide the Group with an additional 0.5 billion cubic metres of natural gas annually, to be delivered to Poland via the Baltic Pipe pipeline. The production startd nearly six months ahead of the scheduled date, means that gas from Tommeliten A will contribute to Poland's energy security already this heating season.
The ORLEN Group will offer customers new services related to the collection and management of industrial carbon emissions. CO2 storage in Poland, including beneath the Baltic Sea floor, will be essential to sustaining the competitiveness of the country’s industries with high emission costs. The ORLEN Group intends to leverage the experience gained in the Barents Sea to develop these services To that end it has entered into a partnership with Norway’s Horisont Energi AS to explore potential collaboration on a project standing out as one of the most advanced CCS initiatives on the Norwegian Continental Shelf.
The retail segment’s contribution to ORLEN Group’s second-quarter result was modest again due to factors including a decline in fuel margins. Sales at fuel stations in Poland represented merely around 1% of LIFO-based EBITDA from the beginning of the year. Also sales of the refining segment more than halved compared with the prior quarter. The combined ORLEN Group generated around PLN 75bn in revenue, with a net profit margin of only 6% (PLN 4.5bn). This proportion is close to the level posted prior to the war in Ukraine. The result was achieved through consolidation with Grupa LOTOS and PGNiG, and best reflects the strong position of the ORLEN Group, which was one of the five fastest advancing companies in the Fortune Global 500 ranking. The scale-up of the combined ORLEN Group’s operations also increases tax revenue streams to the state budget. As Poland’s largest tax payer, ORLEN has already paid PLN 36.5bn in taxes in the first six months of this year, about PLN 20bn more than in the same period last year. This means that with the completed acquisitions and investment projects underway, a large and strong ORLEN genuinely contributes to the sustainable economic and social advancement of Poland.
ORLEN will be able to receive up to 58 shipments of liquefied natural gas per year at the Floating Storage Regasification Unit (FSRU) terminal to be built in the Gulf of Gdansk. The company has finalized an agreement with GAZ-SYSTEM to reserve a regasification capacity of 6.1 billion cubic metres (bcm) per year at the Gdansk terminal. This is another step in the process of strengthening the energy independence of the country and the region.
The second vessel of the fleet of gas carriers being built for the ORLEN Group has just arrived at the port in Świnoujście with a cargo of liquefied natural gas. The vessel, named “Grażyna Gęsicka”, has delivered some 65,000 tonnes of LNG loaded at the Freeport terminal in the United States. The delivery was made based on a spot market transaction.
PGNiG Upstream Norway, the subsidiary of ORLEN SA, and its licence partners have received approval of the Plan for development and operation of Ørn and Alve Nord fields on the Norwegian Continental Shelf. The development will provide the company with approximately 0.4 bcm of natural gas per year at peak production. Alve Nord and Ørn carbon intensity will be more than 3 times lower than the global average for upstream industry. Earlier this month the Norwegian authorities has approved development and production plans for other ORLEN Group fields Fenris and Tyrving as well as for the Yggdrasil area.
On June 17th, the “Grażyna Gęsicka” LNG carrier with an LNG cargo set off on its first voyage to Poland. The tanker will arrive at the President Lech Kaczyński Terminal in about two weeks.
The ORLEN Group’s energy mix until 2030, contribution of the carbon storage technology to reducing emissions as well as specific measures the Group will take to prevent and mitigate climate change-related risks are just some topics addressed by the Group’s climate policy that has just been released to the public. The document paints a comprehensive picture of the ORLEN Group’s approach to managing climate-related issues and systematises its existing initiatives in this area.
PGNiG Upstream Norway of the PKN ORLEN Group has acquired interests in two fields on the Norwegian Continental Shelf. The transaction is consistent with the Group’s strategic objective of increasing its own gas production volumes to boost Poland’s energy security and independence.
The Øst Frigg Beta/Epsilon discovery, where the ORLEN Group's PGNiG Upstream Norway is a licence partner, may contain twice as much oil as previously assumed. The recent discovery increases total resources of Yggdrasil and is considered as a possible tie-in to the development – one of the largest projects currently developed on the Norwegian Continental Shelf. The ORLEN Group is a partner in the Yggdrasil development.
