OREANDA-NEWS. September 15, 2014. Grupa LOTOS 2013?2015 Efficiency and Growth programme has reached its most crucial phase.

In the region of Pomerania, the initiative is contributing to capital investment, new job opportunities and government revenue.

In 2013 alone, LOTOS paid almost PLN 100m in taxes to local governments in the Province of Gdansk.

“We act globally but think locally” says Pawel Olechnowicz, President of Grupa LOTOS Management Board. “LOTOS has established a strong brand reputation in Europe and beyond. The company is the best ambassador of Poland and Pomerania abroad. We are a socially responsible corporate citizen, but we also remember our roots, and our home region is a vital part of our investment programmes and our plans for the future. For LOTOS, Pomerania, and Poland in general, is an attractive place to invest.”

The 2013?2015 Efficiency and Growth programme will focus on projects designed to upscale hydrocarbon production from own sources (including from Baltic Sea fields) and raise the Gdansk refinery's complexity factor. As a major benefit, the programme will stimulate the region's local labour market. With new investments in the pipeline, LOTOS will hire some 370 new employees, with another 1,200 or so jobs to be created by its contractors.

As part of the 2013?2015 Efficiency and Growth programme, LOTOS intends to spend as much as several billion zloty in the coming years, a portion of which will be earmarked for projects located in the Pomerania region.

Time to invest

Based on its investment plans for the coming years, the LOTOS Group intends to scale up its crude oil and natural gas production from Baltic Sea fields. Additionally, the Company plans to launch production from the B8 field at a rate of 250 thousand tonnes of crude annually by the end of 2015. The field's production potential is estimated at some 3.5 million tonnes of crude oil. On August 25th 2014, a subsidiary of LOTOS Petrobaltic entered into agreements with Polskie Inwestycje Rozwojowe S.A., Bank Gospodarstwa Krajowego and Bank Pekao S.A. for the financing of development of the B8 field.

The Company also plans to launch natural gas production from the B4 and B6 fields by the end of 2017. With the combined production potential of approximately 4 bcm, the fields are expected to yield 250 mcm of gas per annum.

To optimise production and improve the efficiency of the Gdansk refinery, LOTOS plans to construct a number of facilities, including a delayed coking unit (DCU) and a hydrocarbon recovery unit (HRU).

The DCU would improve the refinery's annual output of motor fuels by 900 thousand tonnes and allow it to increase its refining margin by approximately USD 2/bbl. The unit is scheduled to come on stream in 2017–2018.

With the HRU, LOTOS would gain an additional 100 thousand tonnes of LPG and 25 thousand tonnes of gasoline annually, which will be placed on the market. The unit is scheduled to be placed in service in autumn 2016.

In the retail area, LOTOS intends to continue the dynamic expansion of its service station network and improve sales efficiency. In line with its strategy until 2015, the Company plans to achieve a 10% share in the retail fuel market (9.1% after Q2 2014).