Ladies and Gentlemen,
2022 was indeed a momentous year for us, despite the extraordinary difficulties we faced. The fuel and energy sector encountered significant challenges, primarily stemming from the war in Ukraine. Russia’s aggression had far-reaching consequences, impacting not only Ukraine as the primary target, but also causing reverberations throughout Europe, particularly in the neighbouring countries. As events unfolded, it became evident that it disrupted the previously perceived stability of the energy supply system.
Letter from the Chairman of the Supervisory Board
However, the ORLEN Group has successfully navigated through this challenging environment. Despite the highly unfavourable macroeconomic conditions and the unpredictability of energy markets, we are sustaining a dynamic pace of growth without any signs of slowing down. We owe this resilience to the diligent market monitoring conducted by the ORLEN Group over many years. As a result, when the war broke out, we were well-prepared for its impact on the energy market. We have emerged from this situation unharmed, thanks to our unwavering commitment to securing a stable future for our shareholders, trading partners, customers, and employees over the years.
By successfully merging the ORLEN Group with Grupa LOTOS and PGNiG, and earlier with the Energa Group, we have established a multi-utility conglomerate that now stands as the largest fuel and energy corporation in Central Europe. It ranks among the world's top 150 companies by revenue, serving over 100 million customers, and employing nearly 65 thousand people. The results reported by the ORLEN Group and the reaction of the financial markets clearly demonstrate that our decision to join forces was the correct one, yielding tangible benefits. A few notable facts include our rating upgrade to A3 by Moody's Investors Service and the two-notch increase in ORLEN’s Long-Term Issuer Default Rating (IDR) to BBB+ by Fitch Ratings. Furthermore, the previous year witnessed a record allocation of PLN 19.6bn towards the execution of the largest investment programme in the Group's history. This year, we anticipate an even higher spending of over PLN 36bn on this project.
Presently, our multi-utility group is focused on effective energy transition, with a particular emphasis on renewable energy sources and zero-carbon nuclear technology. We made further progress on our Baltic Power project. The offshore wind farms that will be developed as part of this undertaking have the potential to ultimately provide electricity for millions of Polish households. A strategic decision was made to build an offshore installation terminal for offshore wind projects in Poland, the first such installation on Poland’s territorial sea. The terminal, to be located in the Port of Świnoujście, will be one of the most advanced facilities of this kind in Europe.
At the end of 2022, we also completed construction of one of Poland’s largest solar PV farms, located near Wielbark, in the Province of Olsztyn. In line with our Hydrogen Strategy unveiled in 2022, we launched the first hydrogen hub in Trzebinia, serving as a foundational element for the future distribution network of this environmentally friendly fuel. We also built our first hydrogen refuelling stations. Furthermore, our investments extend to biofuels, where, apart from biogas and biomethane projects, we are actively involved in the development of second-generation bio additives that will not compete with food production. These ventures play a pivotal role in ensuring the long-term energy security of Poland.
Today, the ORLEN Group stands on solid ground, yet there is a need to further diversify the supply sources of fuels, raw materials, and energy mix. It is our paramount objective to make Poland independent of fossil fuels. This vision drives our strategic decision to adopt advanced small modular nuclear reactor (SMR) technologies as an energy source. Our plan is to construct at least one small nuclear unit in Poland by the end of the decade, and considering the current progress we anticipate that this endeavour will likely result in success.
As the Chairman of the ORLEN Group Supervisory Board, I am filled with optimism as I look at the future. The ORLEN Group has a clearly defined strategy rooted in sustainable development, innovation and a steadfast commitment to meeting the needs of Poles. We will persist in the ongoing development of our multi-utility conglomerate, ensuring energy security, and striving for leadership within the industry.
Wojciech Jasiński,
Chairman of the Supervisory Board, ORLEN S.A.
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ORLEN Group 2022 Integrated Report
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