According to daily Rzeczpospolita, Czech Republic’s government received an offer to buy a minority stake in Ceska Rafinerska from Shell. According to the press similar offers were sent also to the other shareholders of the firm. Shell has 16% stake in Ceska Rafinerska, while the others are: PKN’s subsidiary Unipetrol (51%) and ENI (32%). PKN Orlen declined to comment if it is interested in buying the stake. According to Reuters, Czech ministers are expected to discuss the plans to potentailly acquire stake in rafineries in the coming weeks. However the government is interested in improving energy security of the country. Our view: We see the news as neutral for PKN at this stage however potential purchase of Ceska Rafinerska by Czech government is likely to be positive for PKN if it materializes. Unipetrol which is a majority shareholder of Ceska Rafinerska has been underperforming in the last two years and we believe Czech government might be interested in supporting country’s strategic assets and retaining employment in the industry. On the other hand we do not see rational for PKN to increase its share in Ceska Rafinerska by buying stake from Shell due to the former’s weak assets base, high crude acquisition costs and proximity of competition.