Petrobaltic Trade Unions Go to War with Grupa Lotos

The conflict between Lotos and the trade unions of its affiliate Petrobaltic has escalated. Union representatives wrote a letter to Treasury Minister Wojciech Jasinski, objecting to plans concerning the acquisition or buyout of the remaining 30.32 % stake in their company. The trade unions also say that in the last few years Lotos did not provide the necessary investment in the development of oil and gas resources. Moreover, it has not drilled a single bore-hole in order to confirm the presence of oil in the B23 deposit. Grupa Lotos spokesperson Marcin Zachowicz refused to comment on the accusations.

Our view: The resistance of Trade Unions is definitely against the interest of Lotos and its shareholders. The 100% ownership of Petrobaltics would be very beneficial for the company due to the further growing contribution of E&P segment to the Lotos’ profits. Seemingly the trade unions also realized the high relevance of the B23 project which could even be considered as a positive sign. The company informed us that no drilling but independent 2D seismic survey was performed on B23 field and the results were evaluated by PGNiG’s Geofizyka Turun recently.