The LOTOS Group’s operational priorities are set forth in its Strategy for 2011-2015, its Corporate Social Responsibility Strategy for 2012-2015, and its development directions until 2020.
Strategic business objectives until 2015
Exploration and production
Expansion of the resource base to take advantage of high margins projected for this sector in the long term.
- achieve production volume of 24,000 boe/d (barrel of oil equivalent/day) in 2015 – equivalent to 1.2m tonnes a year,
- increase production of hydrocarbons, in line with the priorities of Poland’s Energy Policy until 2030.
Utilisation of expanded capacities, increasing the conversion ratio, use of synergies between refining and power generation.
- achieve world-class production standards and maintain a strong competitive position among European refineries,
- make optimum use of assets held and acquired as part of the growth strategy,
- ensure safe and stable operation of production and ancillary facilities, with a target of 98% minimum annual availability,
- further increase the conversion ratio and intensify feedstock processing.
Development of the retail chain and marketing structures, based on an extended distribution network and efficient product logistics.
- maintain a 30% share in the domestic fuel market,
- achieve fuel sales 15% above the refinery’s fuel production capacity,
- secure a 10% share in the domestic retail market,
- develop service station chain and enhance the existing stations’ sales,
- maintain the leading position on the Polish market for lubricating oils.
Key objectives of the Corporate Social Responsibility Strategy until 2015.
Investment in human resources
Ensuring the availability of highly qualified staff required to successfully implement the business strategy; enhancing corporate culture based on embraced values.
Ethics and prevention of misconduct
Improvement of our management by ensuring ethical conduct and the transparency of business processes, and by protecting the organization from misconduct.
Energy sector security
Support for initiatives designed to enhance energy sector security in a socially and environmentally responsible manner.
Improvement of health and safety
Raising awareness and involvement in work safety improvement among management staff, employees and contractors.
Management of natural resources in the production process
Reducing environmental risk and continually minimising the environmental impact of the LOTOS Group’s operations.
Partnership relations with the market environment
Building lasting customer relationships through a focus on understanding customers’ needs and delivering expected product quality and safety.
Integration with local communities
Undertaking initiatives to help ensure lasting solutions to social and environmental issues vital to our local communities.
Ensuring that communication with employees is timely and appropriate to their various needs and to building organizational culture based on multi-directional, open communication, including through the development of a system of staff consultations within the LOTOS Group.
In our efforts to fully implement our CSR strategy, in 2013 we launched the Effective and Rising Programme, which comprises a number of economically viable development initiatives, chiefly in the area of our core business. The initiatives offer substantial benefits to the LOTOS Group, its shareholders and potential investment partners, and also contribute to the development of the regions in which they are to be implemented.
1. Innovative investment programme
2. Job creation
3. Investment in human capital and know-how
4. Improved vertical integration
5. Higher revenues
6. Higher dividends
7. Return on capital and increase in value
Higher tax revenues
As with the +10 Programme, the newly planned investment programme will generate a substantial increase in revenue.
Consequently, the state’s revenues from income, property and mineral taxes will go up by ca. PLN 550m annually after 2016.
Higher volumes of sales will also boost revenues from excise duty.
Investments in the upstream and petrochemical segments will improve the Group’s vertical integration.
Diversification entails lower business risk, more stable margins and a stronger competitive position on domestic and foreign markets.
52% of the investment programme’s funds will be allocated to exploration for oil deposits, the majority of which (73%) are located in the Baltic Sea.
These investments will help diversify Polish crude oil sources, improving domestic energy security.
Job creation in the region
Implementation of the programme will increase employment at Grupa LOTOS and its DOFO operators by approximately 1,700 persons.
70% of the planned CAPEX will be spent regionally and in the Baltic Sea.
Technologically advanced projects will enhance the region’s know-how and human capital.
Development activities and implementation of efficiency enhancement projects in identified areas are focused on increasing the LOTOS Group’s value through innovative and sustainable development, with due regard for its stakeholders’ principles and values.
In line with our own principles, as a socially responsible business we seek to:
Always consider the social and environmental aspects of our decisions,
Take responsibility for the impact of our decisions and actions on society and the environment,
Build business models contributing additional value to the organization and its stakeholders,
Integrate our business goals with important social and environmental issues.
Key areas of focus and development until 2020:
Further optimisation of the management model to achieve the highest available efficiency.
Access to proven recoverable reserves of hydrocarbons of approximately 330m boe in 2020.
Production growth to approximately 100 thousand boe/day (equivalent to 5m tonnes of crude a year),
Maintaining at least a 30% share in the domestic fuel market.
Maintaining fuel sales 15% above the refinery’s fuel production capacity.
Maintaining at least a 10% share in the domestic retail market.
Further improvement of the economic efficiency of crude processing, ensuring full utilisation of our assets.
Steps to optimise the power management processes at Grupa LOTOS’s refinery, by expanding its connections with other power systems.