The report has sparked a probe into the deal's legality and raised questions about the government's role in the process.
Published on Monday, the NIK report indicates that assets were sold to private entities under Poland's previous right-wing government for at least PLN 5 billion (around USD 1.3 billion) less than their estimated value.
One of the critical findings in the NIK report is the undervalued sale of shares in Gdańsk Refinery to Aramco, which occurred at about PLN 3.5 billion (around USD 900 million) below the assessed value. This sale not only undervalued the assets but also granted Aramco a strong position in Gdańsk Refinery LLC, including veto rights over key strategic decisions, the audit office said. NIK expressed concerns that this could potentially paralyze the refinery's operations if shareholders disagree on strategic development paths.
The NIK report also criticizes the lack of appropriate oversight by the Minister of State Assets and the Minister of Climate and Environment. Their inaction reportedly failed to minimize risks associated with the merger. In particular, the Minister of State Assets is accused of inadequately supervising the merger process and submitting a proposal for the merger without sufficient basis, which led to the State Treasury losing influence over the direction of approximately 20 percent of products manufactured in Polish refineries.
Furthermore, the report highlights the absence of effective oversight from the Minister of State Assets during the acquisition of the Lotos Group by PKN Orlen.
Maciej Maciejewski, Director of the Department of the Economy, State Treasury, and Privatization at NIK, stated that the asset sale prices were "grossly low," with the exception of the transaction with MOL, a Hungarian oil and gas company. MOL acquired 417 gas stations previously owned by Lotos.
NIK, unable to perform an audit in Orlen, was hindered in a comprehensive assessment of the reasons behind the asset sales at such prices. Consequently, it could not determine whether the merger was economically justified under the remedial measures being implemented, Poland's PAP news agency reported.
Michał Wilkowicz, deputy director of the same department, revealed that the Minister of State Assets lacked full knowledge of the merger's consequences and its impact on the security of critical infrastructure.
The revelation that the minister was not fully informed about the transaction conditions, unaware of the asset valuation results, and did not seek this information, raises serious questions about the government's role in this significant merger in the Polish oil sector, according to the auditors.
They said the lack of initiative in obtaining crucial data and failure to include Gdańsk Refinery in the list of protected entities further underscore the concerns about the transaction's transparency and governance.
As Poland grapples with these revelations, the prosecutorial investigation into the merger and the sale of Lotos adds another layer to this complex issue, indicating potential legal ramifications.
(rt/gs)
Source: PAP