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Conclusion of the Partner's Agreement in project of preparation and construction of the nuclear power plant

  • No. of the report: 41/2014
  • Report date: 03.09.2014
  • Report legal ground: Art. 56 section 5 of Act on Public Offering – information amendments

Contents of the report

In connection with the current report no 111/2013 dated December 31, 2013 on continuation of works in project of preparation and construction of the nuclear power plant in Poland, the Management Board of PGE Polska Grupa Energetyczna S.A. (“PGE”) discloses that on September 3, 2014 PGE, TAURON Polska Energia S.A., ENEA S.A. and KGHM Polska Miedź S.A. concluded a Partners’ Agreement. In accordance with the Partners’ Agreement TAURON Polska Energia S.A., ENEA S.A. oraz KGHM Polska Miedź S.A., as Business Partners, will acquire from PGE, under a separate agreement, a total of 30% of shares (each Business Partner will acquire 10% of shares) in special purpose company - PGE EJ 1 sp. z o.o., which is responsible for preparation and execution of investment of construction and operating of the first nuclear power plant in Poland with a capacity of approx. 3,000 MWe (the “Project”). According to assumptions, PGE Group will be the leader of the Project and PGE EJ 1 sp. z o.o. will be a future operator of the power plant. Obtaining approval of the President of the Polish Office of Competition and Consumer Protection for concentration is the condition precedent for the acquisition of shares in PGE EJ 1 sp. z o.o. by the Business Partners. Appropriate request was filed by the parties of the Partners’ Agreement on August 1, 2014.

According to the Partners’ Agreement, the parties jointly undertake to finance operations in years 2014-2016 under the initial phase of the Project (the “Initial Phase”), proportionally to their shareholdings. The Initial Phase is to determine such elements as potential partners, including strategic partner, technology providers, EPC contractor (Engineering, Procurement, Construction), a provider of nuclear fuel and obtaining financing for the Project, as well as organizational and competence preparation of PGE EJ 1 sp. z o.o. to the future role of nuclear power plant operator, responsible for its safe and efficient operation (the “Integrated Proceeding”). PGE’s financial commitment in the Initial Phase will not exceed amount of approx. PLN 700 million.

The Parties of the Partners’ Agreement anticipate that further decision on the Project, including decision on declaration of further participation of particular Parties in the next stage of the Project, will be made after the completion of the Initial Phase, directly before the settlement of the Integrated Proceeding.

Legal basis: Art. 56 sec. 5 of the Act dated July 29, 2005 on Public Offerings and Conditions Governing the Introduction of Financial Instruments to Organised Trading, and on Public Companies (Dziennik Ustaw of 2009 No. 185, item 1439 as amended).