STRATEGIC GROWTH DIRECTIONS FOR THE ORLEN GROUP’S BUSINESS SEGMENTS
In response to the energy transition, ORLEN2030 will evolve into a more sustainable multi-utility business.
Building a multi-utility group requires that our current portfolio be complemented with new, promising business areas.
Under the new strategy, our growth is based on key pillars of business segment management.
Energyas the main growth area: investment in renewables and gas-fired capacities
Our key growth area over the next decade will be energy, based mainly on renewables and supported by gas-fired sources. By 2030, we intend to achieve over 2.5 GW of installed RES capacity (attributable to the ORLEN Group’s interests), including 1.7 GW in offshore wind farms and 0.8 GW in onshore (wind power and solar PV) sources. We will also increase the installed capacity of our modern gas-fired power plants from today’s 1.1 GW to over 2.0 GW. The generation capacity will be supported by the Group’s extensive and modern distribution network, allowing it to reach a broad base of retail customers and generating a steady stream of profits. The Group will also build energy storage facilities on a pilot basis to optimise the costs of electricity distribution.
Petrochemicalspetrochemical capacity expansion, specialty products and recycling
By 2030, around a half of our profits from crude oil processing will be derived from the petrochemical business. Expansion of the existing portfolio and entry into new business areas will help entrench our position as a leading petrochemical producer in Central Europe. PKN ORLEN is set to ramp up its capacities in olefins and other base products. It will also solidify its position in polymers – a business line with attractive growth potential – by extending the value chain and entering into compounding and concentrates. Concurrently, the share of speciality high-margin products (such as phenol and aromatic derivatives) in the Group’s portfolio will grow from 16% to approximately 25%. Recycling and biomaterials will be new branches of the petrochemical segment. By 2030, we will expand our recycling capacity (mainly in plastics) up to 0.4 million tonnes. We will also implement advanced circular economy technologies.
Refiningmaintaining the position of a leading regional refiner with major investment into biofuels
Until 2030, refining will remain an important segment of our business. Its transformation will be driven by energy efficiency improvements, increased crude conversion rates and integration with Grupa LOTOS, the Group’s major domestic peer. Expansion of the biofuel and hydrogen fuel output will be another vital driver. Within the coming decade, the Group will emerge as the region’s leading producer of biofuels (including 2G biofuels), with an annual capacity of 2m tonnes. As part of the strategy, work will be continued on the Group’s hydrogen hub projects in Włocławek and Płock, and steps will be taken to launch green hydrogen production.
Retailexpansion of the retail network and non-fuel segment
The strategic vision is to vigorously develop our retail arm, based on the network expansion and significant additions to the retail offering. By 2030, the number of Polish ORLEN-branded service stations operating throughout the region will be at least 3,500. Expansion of the ORLEN retail network will focus mainly on foreign markets, with the share of foreign locations up from the current 37% to 45%. We will seek to enhance the availability of alternative fuels, by deploying at least 1,000 EV fast chargers and increasing the sales of hydrogen and LNG/CNG. Our broad, integrated offering of non-fuel products and services will keep attracting new customer groups. Based on the RUCH countrywide chain of newsagents, we will expand our store and food service formats beyond service stations, and will also develop our own network of parcel pick-up points and e-commerce services. Integration with the Energa Group will help ORLEN develop comprehensive service centres for both retail and business customers, encompassing fuel and electricity sales as well as distributed energy solutions. Delivery of the initiatives outlined in the strategy will drive a 50% increase in gross non-fuel margin relative to 2019.
Upstreama sustainable portfolio growth, with a focus on natural gas assets
The strategy envisages prudent expansion of the production asset portfolio, with a special focus on natural gas reserves and potential restoration of the existing portfolio of production assets after merger with Grupa LOTOS. The ORLEN Group will also expand its existing operations in Poland. We will pursue growth in upstream while continuously maximising asset value and driving operational excellence.