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Lotos stands by B4 and B6 Baltic Sea investment plans despite oil price declines, says CEO

TAG'S: LOTOS, Energy

Listed fuel group Lotos still wants to realize B4 and B6 Baltic Sea upstream investments as well as the EFRA coking project as they will be profitable even at current oil prices, CEO Pawel Olechnowicz said on Thursday citing updated analyses.

"The projects have undergone analysis due to the change in market situation: neither the EFRA (coking, hydrogen production and gasoline refining) installation, nor the B4 & B6 raise any doubts as far as the process of their realization is concerned," Olechnowicz said. "In both cases there is a good rate of return and economic viability."




Oil prices have already bottomed out, but price growth is unlikely to be dynamic, Olechnowicz opined.




Near end-2014 Lotos raised PLN 1 bln from a share issue with a view to allocating the means to building a delayed coking unit (DCU) with auxiliary installations as well as launching B4 and B6 Baltic Sea deposits.




Lotos is also in talks with banks on partial financing of the said investments to the tune of some PLN 1.5 bln, Olechnowicz indicated. The basic facility would be USD-denominated.




"Talks are underway, I think they will be closed in the coming weeks," CFO Mariusz Machajewski told reporters. "We have a select group of banks, with which we are talking."



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