Poland delays decision on PKN Orlen privatisation til April

09 January 2002 16:56  [Source: ICIS news]

LONDON (CNI)--Polish privatisation agency Nafta Polska confirmed on Wednesday that it does not expect to decide on the sale of a 17.6% stake in fuel and petrochemical group PKN Orlen until April or May 2002.

It is in exclusive negotiations with MOL after the Hungarian oil, gas and chemicals group was chosen by Poland's out-going government as preferred bidder. These talks had been scheduled to end in mid-January.

But following Poland's elections last September, many believe the new Democratic Left Alliance government may want to protect Poland's inefficient chemicals industry from foreign interference.

The new government could choose to bundle PKN Orlen together with other parts of the oil and chemicals sector, possibly further delaying the process by years. However Poland needs the proceeds from privatisation. Last year it had a budget deficit of Zloty40bn ($10.2bn/Euro11.3bn) or 5% of gross domestic product.

Nafta Polska said that if the faltering sale of oil refinery Rafineria Gdanska to the UK's Rotch Energy is not successful, Rafineria Gdanska will be combined with PKN Orlen. It is unclear whether MOL would still be interested if required to purchase both assets.

A spokesman for MOL said: "We have asked Poland's government to freeze the privatisation process until April."

By: Will Beacham
+44 208 652 3214

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