Poland’s Orlen to buy 6 million tonnes of crude oil from BP, covering 15% of annual demand

Polish state energy firm Orlen has entered into a contract with a British oil and gas giant BP to buy up to 6 million tonnes of crude oil from its Norwegian fields over the next year. The first shipment is scheduled for late August or early September this year, says the Polish firm.

The deal, which will amount to almost 15% of Orlen’s refineries’ annual needs, is part of the firm’s strategy to diversify its oil supplies and ensure a steady source of crude in the wake of Russia’s invasion of Ukraine and the subsequent turmoil on the energy markets.

“The expansion of the portfolio to include additional volume from the North Sea guarantees stable supply to our refineries and, consequently, uninterrupted fuel deliveries to all Orlen gas stations in the region,” said the company’s CEO, Daniel Obajtek.

In addition to Poland, the company has petrol stations in Germany, the Czech Republic, Slovakia and Lithuania. It operates four refineries – in the Polish city of Płock, Litvínov and Kralupy in the Czech Republic, and in Mažeikiai in Lithuania – and its oil processing capacity is approximately 42 million tonnes per year.

“The contract with BP could be potentially a starting point for further cooperation, including in areas related to both companies’ involvement in the energy transition,” Obajtek added.

The Polish company is investing in solar and wind projects, while also planning to build small nuclear reactors at several sites in Poland. However, its CEO did not specify which projects relating to energy transformation Orlen could cooperate on with BP.

Last week, Orlen’s shareholders approved a proposal for the firm to drop the initials PKN (standing for Polski Koncern Naftowy, meaning Polish Oil Concern) from before its name in recognition of its new broader ambitions. Similarly, two decades ago BP sought to rebrand itself from British Petroleum to “beyond petroleum”.

Shortly after tnr invasion of Ukraine, Poland’s government pledged to end all Russian oil, gas and coal imports by the end of 2022. It succeeded with gas and coal, but continued to import Russian oil this year due to a long-term contract. However, in February Russia itself ended those supplies, prompting Orlen to announce legal action.

The company reports that 100% of its oil currently comes to Poland from directions other than Russia, including the North Sea, West Africa, the Mediterranean, as well as the Persian Gulf and Mexico. However, it still imports Russian oil to the Czech Republic.

Main image credit: Orlen press pack

Alicja Ptak

Alicja Ptak is senior editor at Notes from Poland and a multimedia journalist. She previously worked for Reuters.