Poland’s Lotos to Add Group II, III

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Poland’s Lotos to Add Group II, III
Lotos Group plans to modernize its base oil plant in Gdansk, Poland. © Mike Mareen

Lotos Group will spend 1.4 billion Poland zloty (U.S. $365 million) on investment projects in 2021, one of which includes modernization of its base oil plant in Gdansk, Poland, the company said recently.

Lotos and PKN Orlen, a larger Polish energy company, are in the process of merging, subject to approval by the European Union’s antimonopoly regulators. Both companies recently established competence centers that will deal with production of hydrogen and green hydrogen, improvement of rail logistics, offshore maintenance and upgrading of base oils.

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“The fourth competence center will focus on the production of base oils,” Jaroslaw Wrobel, vice president of Lotos’ management board, said during a July 15 investment presentation. “A hydrocracking oil unit project, now at a pre-construction stage, is due to move to the construction phase in the third quarter of 2021.”

Officials expect the project to make the base oil plant more profitable. “This will be possible with production and sale of new high-margin products, such as [API] Group II and Group III base oils,” Wrobel said.

The Gdansk base oil plant has capacity to produce 265,000 tons per year of Group I base oils. Lotos also markets automotive engine oils under the same brand name and different types of industrial lubricants and greases.

In its 2020 integrated report released today, the company said that its subsidiary, Lotos Oil, is focused on the automotive segment, particularly on increasing the share of synthetic and semi-synthetic oil products for passenger cars. 

“As part of its efforts to create added value and drive economies of scale, Lotos Oil was active in the Polish Automotive Group and the Association of Polish Enterprises in Ukraine. The aim of these efforts was to attract new customers for the company’s own products, exchange databases with foreign operators and pursue joint projects to further business expansion within the sector, “ the company stressed in the report.