TAURON Group purchases KWK Brzeszcze

In the presence of the Minister of Treasury, Andrzej Czerwiński, on 19 October the special purpose vehicle from TAURON Group and Spółka Restrukturyzacji Kopalń (Coal Mine Restructuring Company) signed the preliminary contingent agreement for the sale of KWK Brzeszcze assets. On the same day, the management board of the special purpose vehicle concluded the memorandum of understanding with trade union organisations from Brzeszcze, determining the conditions of coal mine personnel transfer and key issues related to employment. In the future the parties will negotiate a new collective agreement introducing the incentive remuneration scheme.

TAURON will pay PLN 1 for the acquired assets. The preliminary agreement contains obligations determining the purchase of a separated part of KWK Brzeszcze from Spółka Restrukturyzacji Kopalń by the 100 per cent subsidiary of TAURON (current name - RSG, the procedure of name change into Nowe Brzeszcze Grupa TAURON is in progress). The assets comprising tangible and intangible components used for the extraction, production and disposal of coal and methane, will be transferred to the Nowe Brzeszcze Grupa TAURON company following obtaining of all corporate approvals and UOKiK approvals as well as the decision of the Ministry of Environment concerning the transfer of concession. In the future, following coal mine restructuring, measures will be undertaken which will lead to the merger of this entity with TAURON Wydobycie company, currently comprising Zakład Górniczy Janina in Libiąż and Zakład Górniczy Sobieski in Jaworzno.

The effective restructuring of the mining sector and its integration under healthy business rules with the energy generation sector is the direction of changes which will ensure the stability of supplies and electricity prices for several following decades. The plan for mining also stipulates increasing of coal demand from the chemical sector, through the implementation of coal technological processing to hydrogen and methanol for industrial use. We have built foundations to recover the sustainable profitability and competitiveness of the mining sector – said Andrzej Czerwiński, the Minister of Treasury.

Due to the purchase of KWK Brzeszcze mining plants of TAURON Group will cover the demand of generation units contained in the holding in over 50 per cent. Currently, this ration amounts to approximately 40 per cent. The future of the energy sector are companies based on the full value chain – from mining, through generation, distribution, up to the sales of electricity and heat to clients. We have been implementing such a strategy. Incorporation of KWK Brzeszcze into TAURON structures is the next step in building of the strong fuel and energy group, using the synergy of mining and generation sub-sectors. Purchasing of the coal mine enables us to become more independent from the external supplies of the raw material and control costs of its acquisition – informs Jerzy Kurella, President of the Management Board of TAURON Polska Energia.

Also on 19 October the management board of the special purpose vehicle concluded the memorandum of understanding with trade union organisations acting in KWK Brzeszcze, pursuant to which it committed itself to continue the former business operations carried out in the plant. The parties to the agreement have also undertaken to conclude a new collective agreement introducing the incentive remuneration scheme for employees, depending on results achieved by the company and the level of implementation of the assigned tasks. It was also agreed that the transfer of approximately 1500 employees of the acquired coal mine will take place pursuant to Article 23(1) of the Labour Code, which allows for maintaining the existing working conditions. On the other hand, employees willing to use the social security cover until the end of this year, as well as those holding pension entitlements, may remain in the structures of the liquidated part of KWK Brzeszcze.

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