Signing a letter of intent between ORLEN Południe and PGNiG concerning analysis of possibilities of realization of common investments regarding production, trading and use of biomethane

PKN ORLEN S.A. (“PKN ORLEN”) informs that on 5 May 2021 ORLEN Południe and PGNiG (“Parties”) has signed a letter of intent (“Letter of intent”), in which the Parties declared the will to start the common talks and actions to analyse possibilities of common investments regarding production, trading and use of biomethane (“Investment”). The Investment will be realised through the joint venture between the Parties, in particular by using special purpose vehicle (“SPV”), where ORLEN Południe will act as a parent entity in the company.

The intention of the Parties is that the core business of SPV shall be in particular acquisition and construction of biomethane plants, development of biomethane production technologies, as well as production, trading and use of biomethane in different fields of the Parties business activity.

The condition to set up the SPV is to obtain an approval of relevant antitrust authorities for the concentration.

The Letter of intent signed today is a result of analytical and development works on biomethane production with a target to create a technological, science, law and economic base to create a biomethane plants network with the production capacity of ca. 4 million m3/ year each plant.

PKN ORLEN holds 100% of ORLEN Południe shares.

See also: regulatory announcement no 50/2020 as of 3 September 2020.