Initial capital increase in ORLEN Oil

Polski Koncern Naftowy ORLEN S.A. ("PKN ORLEN"), Central Europe’s largest downstream oil company, informs of the registration on 11 August 2004 of an increase in the initial capital of ORLEN Oil Sp. z o.o. (“ORLEN Oil”) by a District Court in Krakow (Poland).

The initial capital of ORLEN Oil was increased by PLN 31,535,000.00 from PLN 43,558,000.00 to PLN 75,093,000.00. This was covered by a contribution in cash from PKN ORLEN.

PKN ORLEN’s stake in ORLEN Oil increasd from 9% to 47.2%. The remaining shares are owned by Rafineria Trzebina (43.8%), Rafineria Nafty Jedlicze (4.5%) and Rafineria Czechowice (4.5%).

Every share gives the holder the right to one vote at the General Meeting of shareholders.

The reason for the capital increase is to provide part of the financing of the purchase by ORLEN Oil of Oil Division properties owned by PKN ORLEN. This transaction resulted from the implementation of the agreed strategy, aimed at the consolidation by ORLEN OIL of oil assets operated by PKN ORLEN, in order to create one unit managing PKN ORLEN’s oil business.