ORLEN completes the acquisition of FX Energy

ORLEN Upstream, a subsidiary of PKN ORLEN, has acquired FX Energy by acquiring a 100% equity interest in the company. Thanks to the acquisition, the Company has increased its 2P reserves by 8.4 million boe and secured producing assets in Poland. The value of the transaction was USD 125 million (i.e. PLN 487,6 million).

In the transaction, initiated in mid-October 2015, PKN ORLEN has acquired all shares in FX Energy. During the first stage, the Company acquired 78,21% of FX Energy’s outstanding common shares in a public tender offer. During the second stage, following today’s decision of FX Energy’s General Meeting to merge the company with ORLEN Upstream’s special purpose vehicle (SPV), ORLEN Upstream became the direct owner of all shares in FX Energy, thus gaining full control of the assets belonging to the American company and its subsidiaries. In the near future, once all formal procedures have been completed, FX Energy shares will be delisted from the New York City-based NASDAQ stock market. ORLEN Upstream received clearance for the transaction from the Office of Competition and Consumer Protection (UOKiK).

The total transaction value including the repayment of FX Energy credit facility amounted to USD 125 million (i.e. PLN 487,6 million). Beginning in January 2016, the new assets and planned operational schedules will be integrated with PKN ORLEN’s existing operational base for managing its exploration and production projects in Poland.

As a result of the acquisition, three new exploration and production areas have been added to the Company’s portfolio of projects in Poland. Two of these, Fences and Edge, are located in the Polish Lowlands, while the third one, Block 255, lies in the Lublin basin and is adjacent to ORLEN Upstream’s Wołomin and Garwolin licence areas. The three blocks cover a total area of approximately 7,400 square kilometres. The average output from seven producing fields located within the newly acquired assets reached almost 1,700 boe/d in the first half of 2015.