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Air BP and Grupa Lotos Sign Aviation Agreement


Today Air BP, the aviation fuel services division of BP, has signed an agreement with Grupa Lotos to form a new joint venture to manage the supply, logistics and marketing of aviation fuel in Poland.

The new joint venture, Lotos – Air BP Polska, will be formed by Air BP buying 50 percent of Lotos Tank, the wholly owned aviation subsidiary of Grupa Lotos. Air BP and Lotos will be equal shareholders in the company with both bringing valuable strengths and expertise.

Initially Lotos – Air BP Polska will operate at Gdansk (GDN), Warsaw (WAW) and Krakow (KRK) airports. The only change will be to the name of the company, to Lotos - Air BP Polska, reflecting the change in ownership.

Both companies are committed to significantly growing the presence of the new joint venture in the aviation fuel market in Poland. Lotos – Air BP Polska will leverage Air BP’s global customer relationships and technical operations experience, as well as Grupa Lotos’ local expertise and supply capability.

The deal is expected to be completed in the next six to eight weeks subject to competition authority approval.

David Gilmour, Air BP Chief Executive said: “We are always looking for new opportunities to grow the Air BP business. Poland is the country with the fastest growing aviation fuel sales in Europe and we have found a strong, local partner in Lotos. As always our top priority is going to be managing safe and reliable operations. We will share our technical knowledge to assist the joint venture to operate to industry standards and ensure that everyone who works at the airport locations stays safe.”

“From the perspective of Lotos Tank’s development, it is an important year,” said Maciej Szozda, Lotos Group Vice-President of the Management Board and Chief Commercial Officer “In January, the Company commenced sales of aviation fuel ‘into plane’ at Warsaw Chopin Airport, and will soon provide the same services at Kraków’s John Paul II airport. The beginning of our cooperation with Air BP not only gives Lotos a possibility of competitive development in Poland, but also, and more importantly, is a great opportunity for foreign expansion, which we will surely utilise.”

Alexander Junge, Performance Unit Leader Northern & Central Europe, Air BP said: “through the Lotos - Air BP Polska joint venture we are establishing a significant presence in Poland. We will now be able to provide our commercial airline customers with aviation fuel through our newly formed joint venture when they fly to Poland, and we will expand our general aviation network by enabling customers to use their Air BP Sterling card at all the joint venture’s new locations.”

“Poland is an important market for BP,”said Bogdan Kucharski, General Manager of BP Europe, SE, Polish Branch. “Since 1991 BP has invested almost US$1 billion in Poland. BP is among the 15 biggest companies in Poland and we are the leader in the fuels retail sector with over 455 service stations. While pursuing our strategy of significantly increasing our presence in Poland we are typically investing tens of millions of dollars per year. We believe in investing in success in Poland.”

Notes to Editors

Air BP is the aviation services division of BP and markets aviation fuels and specialist products around the world. Air BP has a network of operations at around 600 locations in over 45 countries and sells over seven billion gallons of fuel a year. Air BP’s many customers include domestic and international airlines, the military, business and private aircraft owners, as well as international airports and airfield operators. Air BP’s team of engineers are able to provide a complete aviation fuel consultancy service to other organisations looking for aviation fuel expertise.

BP entered the aviation fuel business in the mid-1920s and currently fuels more than 8,700 flights every day – that’s one every 10 seconds.

LOTOS is the second largest company in Poland in terms of revenue. The Company operates in exploration, production and crude oil processing, as well as in distribution and sales of a wide range of petroleum products. The Company is successful on wholesale and retail markets, and its shares have been listed on the Warsaw Stock Exchange since June 9th 2005.

Lotos holds a one third share in the Polish fuel market. Additionally, the Company is the leading producer and supplier of motor oils and road bitumens, which sell well both in Poland and abroad.

After successful implementation of the 10+ Programme (the largest Polish industrial investment in 20 years), the annual utilisation capacity of the refinery in Gdańsk increased from 6 to 10.5m tonnes. The Company has also acquired state-of-the-art refinery installations for deep crude conversion, which enable Lotos to provide the national market with, for example, additional amounts of diesel oil. Following the 10+ Programme, the Lotos Group refinery in Gdańsk now also stands among the most modern refineries in Europe.

Through its subsidiaries – Lotos Petrobaltic, Lotos Norge and Lotos Geonafta, the Company conducts operations in the Baltic Sea, the North Sea and the Norwegian Sea, as well as in Lithuania, where it is involved in natural gas and crude oil exploration and production from onshore and offshore fields. Lotos is the second largest producer of hydrocarbons in Poland, and the only Polish operator extracting crude oil and natural gas from offshore deposits in the Baltic Sea. It is also the leading producer of crude oil in Lithuania. In line with its strategy for 2011-2015, Lotos plans to produce 1.2m tonnes of oil annually by 2015.

Currently, the Lotos network comprises 400 outlets, located conveniently in urban areas and along main road arteries all over Poland. The latter, thanks to spacious parking lots, can serve as excellent resting places for travellers. The Company also carries out projects related to development of service stations at motorways and expressways (as part of so-called Motorway Service Areas).

Another effect of the 10+ Programme is that Lotos Tank has markedly enhanced its position on the jet fuel market. In 2012, the Grupa Lotos S.A. refinery in Gdańsk produced over 500,000 tonnes of aviation fuel. Lotos Tank is also active at the Gdańsk Lech Wałęsa Airport, and is preparing to launch operations at the John Paul II International Airport in Kraków-Balice. In addition, Lotos Tank supplies fuel to the airports in Wrocław and Rzeszów, which, however, handle the filling operations themselves.

After the transaction is finalised Lotos Tank will continue its operations as Lotos – Air BP Polska.


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