The Management Board of Rafineria Trzebinia S.A. has decided to temporarily withhold the production and sale of the bio-fuel “ON BIO" containing 20% FAME esters

The Management Board of Polski Koncern Naftowy ORLEN S.A. (“PKN ORLEN”) hereby informs that on January 3rd, 2007 it was informed by the Management Board of Rafineria Trzebinia S.A. (“Trzebinia Refinery”) that it had decided to temporarily withhold the production and sale of the bio-fuel ON BIO containing 20% FAME esters (“ON BIO”). The decision was made due to the coming into force on January 1st, 2007 of a Regulation of the Minister of Finance dated December 22nd, 2006, (“Regulation”). This changed the previous law referring to exemptions from excise tax (Journal of Laws 2006 No. 243, item 1766).

Following a detailed economic analysis, the Management Board of Trzebinia Refinery S.A. has estimated that, due to the change in Polish law introduced in the Regulation, the net loss of Trzebinia Refinery in January 2007 will amount to approximately PLN 2.5 – 3 million. The production of ON BIO is therefore to be kept on hold until the event that new regulations which will justify production of this particular bio-fuel are introduced.

Due to the abovementioned changes, given the current situation the Management Board of Trzebinia Refinery S.A. has made the decision to concentrate the trading and marketing activities on the sale of FAME esters for foreign markets only.

Moreover, the announced change in the tax regulation has caused the necessity for the renegotiation of supply contracts for feedstocks for the production of ON BIO.

The Management Board of Trzebinia Refinery S.A. has also made a decision to halt investment projects, some of which are already in the pipeline, for the further significant development of production capacity for the bio-fuel.

PKN ORLEN holds 77.2% of the shares in the Trzebinia Refinery Capital Group.

This announcement has been prepared pursuant to Article 56 section 1 point 1 of the Act on Public Offerings, Conditions Governing the Introduction of Financial Instruments to Organized Trading, and Public Companies dated 29 July 2005 (Journal of Laws No. 184, item 1539).