PKN Orlen in accordance with the organization of the eurobonds issue, which is planned to take place at the turn of June and July announced that the assumed total capital expenditure for the PKN ORLEN Capital Group in years 2007-2012 will amount to PLN 21.18 billion. Assumptions already include estimated capital expenditure for the Mazeikiu Nafta Capital Group in the amount of PLN 4.57 billion.
CAPEX in the PKN ORLEN Capital Group in PLN billion |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
Total |
Annual average |
|
|
|
|
|
|
|
|
|
Petrochemicals |
0.54 |
1.28 |
1.94 |
1.19 |
0.54 |
0.39 |
5.87 |
0.98 |
Refining |
1.4 |
1.73 |
1.3 |
0.75 |
0.67 |
0.16 |
6 |
1 |
Chemicals |
0.16 |
0.23 |
0.22 |
0.33 |
0.34 |
0.24 |
1.51 |
0.25 |
Retail |
0.73 |
0.58 |
0.53 |
0.43 |
0.58 |
0.4 |
3.26 |
0.54 |
Crude oil trade and Upstream |
0.05 |
0.29 |
0.29 |
0.29 |
0.29 |
0.29 |
1.49 |
0.25 |
Others (including: Supporting production, Logistics, Oil, Wholesale, Corporate Center) |
0.74 |
0.59 |
0.47 |
0.43 |
0.43 |
0.38 |
3.04 |
0.51 |
Total |
3.63 |
4.69 |
4.74 |
3.42 |
2.84 |
1.86 |
21.18 |
3.53 |
Our view: When compared to the previously announced investment plan, the planned CAPEX for 2007-09 was PLN 10.9bn versus new PLN 13.1bn (PLN 2.2bn difference).
According to our calculation the share of investments in Mazeikiu Nafta should be at PLN 3.1bn, which means that some other investments were cut. These are mostly the upstream expenditures as well as some reduction in refining investments. The total amount of investments in 2007-12 is 8% lower than our assumption of PLN 22.9bn for these years, due to our expectation on rising prices in the construction sector. We believe the news should have neutral trading impact on
PKN shares today.