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Polish oil and gas group Orlen might suspend or terminate Olefins job

Polish oil and gas business Orlen stated it is reassessing the future of its Olefin III petrochemical task due to profitability concerns, including that it is exploring alternatives including short-lived suspension, or termination.

The task, which is anticipated to be wrapped up by early 2030, has an approximated completion expense of in between 45 and 51 billion zlotys, Orlen said late on Wednesday.

The choice of situations is driven by the protection of the business's interests and is based upon analysis of the petrochemical market, macroeconomic circumstance, and the success of the task, the company stated.

This follows the company's Tuesday announcement that its Olefin petrochemicals job would not produce positive cash flow in the future due to adverse economic conditions, leading to a writedown of 912 million zlotys ($ 225.37 million) of the value of its petrochemical business.

The job has actually already seen other financial investment writedowns, and Orlen has pledged to decide on its future before the end of this year.

Although it's late to decide to halt deal with the project, this is the building and construction that has triggered the most debate amongst minority investors, said Erste Group expert Jakub Szkopek.

The marketplace should respond favorably due to the increase in FCF (free cash flow) in the years to come, he added.

(source: Reuters)