Polish state to buy utilities' stakes in anthracite mine operator for a zloty (updated)

Energa S A

03/08/2022 18:36

(Adds context, background and quotes from an analyst and
ministry of state assets spokesperson)
    GDANSK, Aug 3 (Reuters) - The Polish state is buying stakes
in anthracite mine operator Polska Grupa Gornicza (PGG) for a
zloty from four state utilities under a conditional deal
announced on Wednesday, as Warsaw works to transform the
heavily-polluting coal sector.
    Poland is one of Europe's biggest producers of coal and
relies on the fuel for around 70% of its electricity production
but under pressure from the European Union, it has encouraged
more investment in low emission sources.
    At the end of May 2021, the state assets ministry said it
would take over coal assets from its utilities, including PGE
Polska Grupa Energetyczna, Enea and Tauron Polska Energia
 TPE.WA  in the second or third quarter of 2022, and then
transfer them to a new state-owned company.  urn:newsml:reuters.com:*:nL5N2ND1AW
    Under the conditional deal announced on Wednesday, Energa
 ENGP.WA , PGNiG  PGN.WA , PGE  PGE.WA  and Enea  ENAE.WA  will
each sell all of their shares in PGG to the state for a zloty.
    "This is one of the steps leading to separation of coal
assets from energy companies and realisation of conditions set
in the social contract on coal mining" Ministry of State Assets
spokesperson Karol Manys told Reuters.
    The social agreement seeks to ensure the country's energy
security and protect mine workers as Warsaw gradually phases out
coal. 
    Ipopema Securities analyst Robert Maj described Wednesday's
news as positive, though he said "the process seems to be moving
slowly but surely".
    Noting that PGG had "never been able to generate positive
cash flows in its history", he said "on the other hand, on-going
coal price negotiations with the energy sector on their
long-term contracts may now gain fresh dynamic with a new
owner".

 (Reporting by Patrycja Zaras and Mateusz Rabiega; Editing by
Alison Williams and Emelia Sithole-Matarise)
 ((Patrycja.Zaras@thomsonreuters.com;))