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Saudi Aramco in Poland – will it reach for petrol stations? Krzysztof Romaniuk from POPiHN comments

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Aramco may reach for petrol stations in Poland if the opportunity arises, believes Krzysztof Romaniuk, director of fuel market analysis. In his opinion, the best margins are obtained by having the entire supply chain, i.e. production, wholesale and retail.

Krzysztof Romaniuk, director of fuel market analysis of the Polish Organization of Petroleum Industry and Trade (POPiHN), was asked by PAP how the Polish fuel market will change after Saudi Aramco, a Saudi oil and fuel tycoon, enters it.

– It is an entity that is a significant global player, not only that, with a rather important voice when it comes to what will happen in Rafineria Gdańska. Therefore, it can be expected that the decisions will be twofold: they may decide on the further development of Rafineria Gdańska, or they may decide on increasing imports for their own commercial needs. At this point, the entity that spun off from Lotos becomes an independent and important player, replied Romaniuk.

Cooperation of Saudi Aramco and Orlen

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In his opinion, Aramco will cooperate with Orlen. – But if they wanted to play va banque, they are able, having such a base and tanks that they have nearby in ARA ports – to bring more goods to Poland, the more so that it will be partly their product, which we today, supplementing our demand, we have to import from Arabia – said Romaniuk. He noted that other companies also buy diesel in the Middle East.

When asked whether Aramco Fuels Poland could position itself as a competitor to Orlen, Romaniuk replied that “theoretically it is possible”.

– It’s hard to say what it will look like. Our observations show that, for example, they have slightly different prices than Orlen, which they offer in our country in wholesale – he said. According to Romaniuk, this is already “some kind of reference source”.

– Once you can buy cheaper in Orlen, and at a slightly better price in Gdańsk, i.e. in Saudi Aramco – he added.

– There are differences (…) and there will certainly be differences in price discounts for these larger customers. If someone buys more, you can offer him a slightly more favorable price. Anyway, Orlen is doing the same, pointed out the POPiHN expert.

Saudi Aramco stations in Poland?

Is it possible that Aramco will want to develop its own fuel network in Poland?

– If such an opportunity arose, it is possible that the Arabs would also invest in this plot. It is (…) a big player, and because it has engaged in the production of fuels in the country and the supply of these fuels to the country, the next stage of development is the purchase of a petrol station where you can sell your fuel at a good profit – explained Romaniuk.

He emphasized that the best margins are obtained by having the entire supply chain, i.e. production, wholesale and retail. “Then we collect all three margins: refining, wholesale and retail” – said the expert.

Petrol stations in Poland – data

According to the POPiHN report, in 2022, 47.9 percent. stations in Poland belonged to private owners independent of other groups. In this group, 1,411 service stations belonged to operators with at least 10 facilities in their networks operating under one logo. Experts pointed out that in the independent segment, the best development dynamics was recorded by the MOYA chain, owned by ANWIM. Other private networks, such as Grupa Pieprzyk and AVIA owned by Unimot, also developed well.

On November 30, 2022, PKN Orlen informed that “in order to implement remedies in the area of ​​the fuel production market and the fuel wholesale market, as defined in the decision of the European Commission of July 14, 2020 expressing conditional consent to the concentration consisting in the acquisition of control by the company over Grupa Lotos (…) on November 30, 2022, the company signed with Aramco Overseas Company BV (…) the promised agreement for the sale to Aramco of 100% of shares in Lotos SPV 1 Sp. z oo”.

“As part of the transaction, already announced in January 2022, PKN Orlen will maintain a 70% stake in the refinery in Gdańsk with a total processing capacity of 210,000 barrels per day, Aramco will take up a 30% stake in the refinery, 100% of the wholesale business and 50% of shares in the area of ​​jet fuel in BP Europa SE, operating at 7 airports in Poland, PKN Orlen said in a press release.

Saudi Aramco on its website informs that it operates in Poland through ARAMCO OVERSEAS COMPANY BV, which owns 100 percent of the company. shares in Aramco Fuels Poland. As part of the merger between PKN Orlen and Grupa Lotos, Aramco Fuels Poland purchased a separate part of Lotos Paliwa dealing with the wholesale of fuels. ARAMCO OVERSEAS COMPANY BV, is also a co-owner of: Air BP Aramco Poland (50%) and Rafineria Gdańska (30%).

Sale of Saudi Aramco 1/3 of the Gdańsk Refinery

The global fuel giant Saudi Aramco has owned 1/3 of the Gdańsk Refinery since November. The sale of part of the shares in the Lotos refinery in Gdańsk was one of the conditions of the European Commission for the takeover of Lotos by Orlen. The Saudis paid PLN 1 billion 150 million for them, which many experts considered a very low price.

Adam Czyżewski, Orlen’s chief economist, was asked in March in “Rozmowo Piaseckiego” why shares in the refinery were sold so cheaply. – To sell, first you have to agree on the transaction, then wait until European Commission he will approve it, meanwhile the war broke out, the prices changed and the deal was prepared,” he said. He added that “then that was the price on the market.” “The situation is changing a lot because we are talking about 2020 and now we are in 2023. A lot of refineries in the world have been shut down since 2020, Czyżewski said. When asked when the sale price of shares in the refinery was decided, he replied: – During the pandemic, just when the refineries were shut down. He specified that it was “the end of 2020”.

Read also: Saudi Aramco took over 1/3 of the Gdańsk Refinery. When was the price set?

Main photo source: Shutterstock

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