LONDON (ICIS)--PKN Orlen is to invest Polish zloty (Zl) 85bn ($22.8bn ) in the next 10 years in renewable energy development and advanced, greener petrochemicals as the state-controlled energy major reiterated on Monday its pledge to sharply cut emissions.
Another Zl55bn will be invested in increasing the efficiency of current assets over the next decade.
“By 2030, the petrochemical segment will generate approximately half of the Orlen Group's profits from crude oil processing,” Orlen said.
The producer said it would expand its capacities in olefins and other base products, as well as strengthen the company’s position in polymers.
It will target extending the value chain, and enter the area of compounding and concentrates, it added.
It will also set up a new business line under the petrochemical division focused on recycling and biomaterials.
“The share of specialised, high-margin products, such as phenol and aromatic derivatives, will increase in the Group's portfolio from the current 16% to approximately 25%,” it said.
“By 2030, the Orlen group will achieve recycling capacities – primarily of plastics – of up to 400,000 tonnes[/year]. It will also implement advanced technologies of the circular economy.”
Orlen said it was aiming to reduce carbon dioxide (CO2) emissions by 20% by 2030 from its refining and petrochemical assets, and by 33% in its energy divisions.
One of PKN Orlen’s goals set out in the 10-year strategy is to bring about a two-and-a-half-fold increase in annual earnings before interest, tax and depreciation (EBITDA), to approximately Zl 26bn.
The energy, petrochemical and refinery segments would generate approximately Zl 7bn in EBITDA, the company said.
COAL ADDICTION VS NET
PKN Orlen said in September it aims to become climate neutral by 2050.
However, Poland is the only EU member state that has not pledged to cut emissions to zero by that year.
Poland’s energy mix has coal at its core, with more than half of its electricity still produced with the most polluting fossil fuel; coal mining, meanwhile, remains a large employer in the country.
However, this has not deterred PKN Orlen from trying to achieve greener credentials as international investors have started shying away from crude and energy majors which are heavily dependent on fossil fuels.
The producer also intends to have 2.5GW of installed capacity coming from renewable sources; 1.7GW of it would come from offshore wind farms in the Baltic Sea, and 800MW from wind farms and photovoltaics on land.
The group is also targeting 2.0GW of capacity at its gas plants, up from the current 1.1GW.
The company’s 10-year strategy, called Orlen2030, includes plans to take over the second Polish oil refiner Lotos, another state-controlled company.
However, it does not take into account the planned acquisition of state-owned gas company PGNiG as Orlen is still working on obtaining EU approval for that deal.
“We are well aware that the business segments in which we are the strongest today will require extremely profound changes. We are prepared for them,” said Orlen’s CEO Daniel Obajtek.
($1 = Zl 3.73)
Front page picture: A coal mine and
coal-fired power plant in Turow, from which
emissions have an impact not only on Polish
neighbouring communities, but also on Czech and
German communities; Poland's government is
increasingly becoming isolated within the EU
for its support for the coal
Picture source: Petr David Josek/AP/Shutterstock