Memorandum of Understanding between PKN ORLEN and ConocoPhillips

Polski Koncern Naftowy ORLEN S.A. ("PKN ORLEN"), Central Europe's largest downstream oil company ("ORLEN") announces that on January 7, 2004 ORLEN and ConocoPhillips Central and Eastern Europe Holdings B.V. with its registered office in Rotterdam, the Netherlands ("ConocoPhillips") signed Memorandum of Understanding whereby they agreed the intention of their co-operation in the privatisation process of Unipetrol a.s., a company operating in the Czech oil sector ("Unipetrol").

The Memorandum of Understanding sets out preliminary terms of the cooperation of the parties, outlines the proposed ultimate shareholding of the parties in some of the companies of Unipetrol Group and the potential terms of the acquisition by the parties of some assets of Unipetrol Group, in the event of the PKN successful participation in the Unipetrol privatization.

The Memorandum of Understanding represents an early stage in the discussions between ConocoPhillips and ORLEN and does not constitute a legally binding obligation of any party to enter into any future agreement.