Polish energy concerns plan takeover of CEZ Group assets in Poland

Energy companies PGNiG and PGE have submitted a joint non-binding offer to acquire the Polish assets of Czech energy concern CEZ Group as part of a strategy to “re-Polonise” the energy sector, the companies said in a Friday press release.

CEZ invited letters of intent to be submitted by September 29 in the process of purchasing the group's Polish assets. It wants to sell CEZ Skawina, CEZ Chorzów, CEZ Energy Products Poland and CEZ Poland.

The assets include two combined heat and power plants with a total installed capacity of 568 MWe and 1,088 MWt. The concern also provides support services in the field of combustion by-product management, communication, trading and corporate services.

CEZ announced that by the closing date it had received 14 declarations from potential investors. The deadline for submitting initial bids was set to expire on December 7.

According to its strategy published in May last year, CEZ wanted to concentrate more on its domestic market, and that it wanted to exit segments and markets with poor prospects.

In an interview with PAP Business Jerzy Kwieciński, PGNiG president, said that the gas concern was "interested in various heating assets, and we constantly analyse what is happening on the market".

"We are committed to the so-called re-Polonisation of energy assets,” he added. “They are for sale and they are assets often with a very large carbon footprint, and we believe that we can deal with that. Not all companies would be able to meet such challenges."

Kwiecinski said that if there are takeovers of heating assets, they will later require investment.

"Adapting heating assets to EU requirements and regulations will require significant expenditure in the coming years,” he explained. “First, to meet BAT (Best Available Techniques - PAP) requirements in the short and medium term, and then to transfer these assets from coal to gas."

He pointed out that PGNiG, as a leader on the Polish gas market, is interested in having good gas recipients in the long term, and such recipients are companies from the heating sector.

In mid-November, a consortium consisting of PGNiG and PGE also submitted a preliminary non-binding offer to purchase assets owned by Finland's Fortum Holding in Poland. Fortum has heating assets in five Polish cities (Płock, Częstochowa, Bytom, Zabrze and Wrocław), including multi-fuel CHP (combined heat and power) plants in Częstochowa and Zabrze.