Integration of oil companies under the ORLEN brand
As part of ongoing efforts to consolidate its successive business segments, ORLEN has merged ORLEN OIL with LOTOS Oil. This operation not only solidifies our leadership in the Polish lubricants market but also paves the way for dynamic international expansion, including through the launch of advanced finished oil production. ORLEN OIL products are already available in 78 countries worldwide.
“By combining ORLEN OIL with LOTOS Oil, we are poised to enhance operational efficiency and unlock significant development potential within the lubricants market. In this way, we are building our position as a robust domestic company capable of competing both in Poland and abroad. The integration of assets will produce synergies that will enable us to increase investments and maximise the utilisation of existing resources, thereby strengthening the entire value chain of the ORLEN Group,” says Daniel Obajtek, CEO and President of the ORLEN Management Board.
The integration of the oil companies involved the transfer of all LOTOS Oil assets to ORLEN OIL. Presently, ORLEN OIL operates four production plants: the facilities in Trzebinia and Jedlicze, and two plants acquired from LOTOS Oil, in Czechowice-Dziedzice and Gdańsk. It has a headcount of nearly 700, and its annual lubricant production capacity now stands at approximately 420,000 tonnes. The consolidated company is headquartered in Gdańsk.
Work is currently underway to develop a new integrated product offer for ORLEN OIL. Notably, it will soon feature Group II base oils, to be produced at the Hydrocracked Base Oil (HBO) unit in Gdańsk. Launch of this product category in Poland and on foreign markets will significantly increase ORLEN’s competitiveness, and will open up a wide range of possibilities for ORLEN OIL to manufacture advanced finished oils for the automotive, industrial and marine sectors. The HBO unit’s annual output will comprise over 400 thousand tonnes of Group II base oils and several dozen thousand tonnes of fuel intermediates. The project, expected to be completed in 2025, is valued at some PLN 1.4 billion.
The merger of ORLEN OIL with LOTOS Oil is another step in the consolidation process started after ORLEN’s acquisition of Grupa LOTOS and PGNiG last year. The companies that have been integrated to date include PGNiG Upstream Norway and LOTOS Exploration & Production Norge, both with upstream operations on the Norwegian Continental Shelf, and LOTOS Kolej and ORLEN KolTrans, active in the rail transport sector.
According to the latest estimates, the creation of a multi-utility Group based on the assets of ORLEN, Grupa LOTOS and PGNiG is projected to generate synergies of PLN 20 billion by 2032. This is double the figure initially expected before the merger of these companies. Achieving these synergies will be made possible through the successful execution of over 160 integration and transformation projects, which will enable the combined entity to leverage cutting-edge technologies, optimise resources, implement innovations, and enhance the overall efficiency of the consolidated areas.