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In Poland it was discovered that part of the country's fuel market was sold to the Saudis cheaply

Ukraine (bbabo.net), - In order for the Polish energy concern PKN Orlen to absorb its competitor Grupa Lotos, it had to sell part of the Gdansk oil refinery. After the victory of the opposition party in the elections and the change of government, it turned out that the share of a large plant was given to a Saudi company for more than half the price. The Polish concern counters that the value of the refinery was calculated taking into account cheap Russian oil, which no longer exists, but Saudi oil does exist.

The Supreme Chamber of Poland (NIK) stated that the country's fuel security was under threat due to the takeover of the Lotos group by PKN Orlen, although everything should have been the other way around. The point is that, according to the antimonopoly decision of the European Commission, in order to carry out the transaction, PKN Orlen had to sell 30% of the Gdansk Oil Refinery to an external investor. That’s what it did - the plant’s share went to the Saudi state company Saudi Aramco.

“PKN Orlen received 4.6 billion zlotys ($1.15) for the sale of assets that are subject to corrective measures of the European Commission. According to the chamber, PKN Orlen sold assets at least 5 billion zlotys ($1.25 billion) below their assessed value,” the Polish Supreme Chamber (NIK) said in a statement.

NIK noted that the sale price of a minority stake in Rafineria Gdańska, which owns an oil refinery in Gdansk, to Saudi Aramco was inadequate.

“At the same time, Aramco received additional benefits and powers, including the right to veto key strategic decisions regarding the management of Rafineria Gdańska. In addition, Aramco received the right to dispose of half of the products produced at the Gdansk oil refinery. This means that after the merger of PKN Orlen and Grupa Lotos, state-controlled enterprises lost the ability to manage the volumes of petroleum products (gasoline, diesel fuel) obtained from refining about 5 billion tons of crude oil. Thus, the State Treasury has lost influence on approximately 20% of petroleum products produced in Poland,” the chamber said.

Orlen did not delay in answering. The concern cited that the Supreme Court of Audit made errors in the methodology, including due to the fact that the Gdansk Oil Refinery no longer receives Russian oil.

“In accordance with the methodology used by LOTOS to calculate the model refining margin, NIK assumed that all oil processed in Gdansk comes from Russia. This had a significant impact on the value of this indicator, since raw materials from Russia, as a rule, were cheaper than alternative types of oil, and therefore the margin used in the calculations was higher. However, this assumption did not correspond to the real situation in Gdansk, where the use of Russian raw materials was falling as a result of a consistently implemented diversification strategy and Poland’s complete independence from supplies from Russia. By using the LOTOS refining margin model, NIK simply ignores the facts and makes a methodological error by using an indicator that hides the real costs of obtaining oil from the Gdansk refinery,” Orlen said.

The concern also announced the significant role of the Saudis in Poland’s energy security.

“A key element of cooperation with Saudi Aramco is an agreement that guarantees an increase in Arab oil supplies to 20 million tons per year, which is approximately 45% of the needs of the entire integrated ORLEN group in Poland, the Czech Republic and Lithuania. Thanks to these additional supplies, Poland is now completely free from Russian oil and is provided with supplies of raw materials,” the concern continued. They agreed that the sale of 20% of petroleum products produced in the country came under the control of the Saudis. But they insist that exports from Poland are controlled by state-owned companies and large-scale export of fuel is impossible without them.

The attacks on Orlen began after the pro-government Law and Justice party lost the election. She had to go into opposition.

“Prior to the merger and disposal of Lotos assets, the Polish state controlled all assets of Orlen and Lotos as the dominant shareholder (Orlen admitted this in proceedings before the European Commission), and after the transaction transferred a significant part of control to Saudi Aramco, MOL and Unimot. The de facto merger is an interim instrument that allows the division of Lotos assets between external entities such as Saudi Aramco, MOL and Unimot, including shares in the Gdansk oil refinery, which will result in the loss of control of these assets by the Polish state. The Gdańsk Oil Refinery is classified as critical infrastructure in terms of the country's energy security. These are facts, not opinions,” Michal Romanowski, a professor at the University of Warsaw, told BiznesAlert.

In Poland it was discovered that part of the country's fuel market was sold to the Saudis cheaply