10/2021
10/2021
Conclusion of an additional Amendment to the Long-Term Agreement with ENEA Wytwarzanie Sp. z o.o.
Current Report No. 10/2021
Date of preparation: 30 April 2021
Subject: Conclusion of an Additional Agreement and Amendments to the Long-Term Agreement with ENEA Wytwarzanie Sp. z o.o.
General legal basis: Article 17.1 MAR – Inside Information.
Content:
The Management Board of Lubelski Węgiel Bogdanka S.A. (the “Company” or the “Seller”) hereby announces that on 30 April 2021 it concluded an Additional Agreement for sale of coal No. UD/LW/02/2021 (“Additional Agreement No. 2”) – the second in 2021 – with ENEA Wytwarzanie Sp. z o.o. with registered office in Świerże Górne. On the same date, the Company also concluded an Amendment (“Amendment”) to Long-Term Agreement No. UW/LW/01/2012 (“Long-Term Agreement”), which was the subject of Current Report No. 31/2019 of 31 December 2019.
The conclusion of the first Additional Agreement and Amendments to Long-Term Agreement were referred to by the Company in Current Report No. 7/2021 of 19 February 2021.
Additional Agreement No. 2, implemented in addition to the Long-Term Agreement, sets out the terms and conditions concerning the price and volume of coal supplies to the Kozienice Power Plant (Elektrownia Kozienice) during its term from the date of its conclusion to 31 July 2021. The value of supplies provided for in Additional Agreement No. 2 is estimated at PLN 324.3 million in addition to the value of supplies set out in the Long-Term Agreement.
As a result of concluding Additional Agreement No. 2 and the Amendment, the volume of coal delivered during the term of the Additional Agreement No. 2 will lower the volume of supplies provided for in the Long-Term Agreement for 2021 – their delivery will be transferred from 2021 to 2027.
The total volume of the Long-Term Agreement will not change as a result of concluding the Amendment, the total value of supplies to Elektrownia Kozienice will, however, increase in 2021-2027 by the value of Additional Agreement No. 2.
Another partial determination of the terms and conditions of supplies for 2021 due to conclusion of the Additional Agreement No. 2 and the Amendment to the Long-Term Agreement is a result of the current situation in the sector producing electric energy from hard coal.
Additional Agreement No. 2 provides for the following liquidated damages:
- if quality parameters of supplied coal batches fail to comply with border parameters specified in the agreement, the Buyer is entitled to apply liquidated damages the amount of which shall be determined depending on the level of exceeding the parameter;
- if the amount of coal specified in Additional Agreement No. 2 is not delivered or not collected, liquidated damages shall be calculated as 20% of the net value of undelivered or uncollected amount of coal.
Due to relatively short term of Additional Agreement No. 2, the Parties do not provide for the possibility of its termination.
Other terms and conditions of Additional Agreement No. 2 do not differ from the market conditions applied in such agreements.
The Management Board treats the above information as significant given the dominant share of the recipient in the Company’s supply portfolio.
Date of preparation: 30 April 2021
Subject: Conclusion of an Additional Agreement and Amendments to the Long-Term Agreement with ENEA Wytwarzanie Sp. z o.o.
General legal basis: Article 17.1 MAR – Inside Information.
Content:
The Management Board of Lubelski Węgiel Bogdanka S.A. (the “Company” or the “Seller”) hereby announces that on 30 April 2021 it concluded an Additional Agreement for sale of coal No. UD/LW/02/2021 (“Additional Agreement No. 2”) – the second in 2021 – with ENEA Wytwarzanie Sp. z o.o. with registered office in Świerże Górne. On the same date, the Company also concluded an Amendment (“Amendment”) to Long-Term Agreement No. UW/LW/01/2012 (“Long-Term Agreement”), which was the subject of Current Report No. 31/2019 of 31 December 2019.
The conclusion of the first Additional Agreement and Amendments to Long-Term Agreement were referred to by the Company in Current Report No. 7/2021 of 19 February 2021.
Additional Agreement No. 2, implemented in addition to the Long-Term Agreement, sets out the terms and conditions concerning the price and volume of coal supplies to the Kozienice Power Plant (Elektrownia Kozienice) during its term from the date of its conclusion to 31 July 2021. The value of supplies provided for in Additional Agreement No. 2 is estimated at PLN 324.3 million in addition to the value of supplies set out in the Long-Term Agreement.
As a result of concluding Additional Agreement No. 2 and the Amendment, the volume of coal delivered during the term of the Additional Agreement No. 2 will lower the volume of supplies provided for in the Long-Term Agreement for 2021 – their delivery will be transferred from 2021 to 2027.
The total volume of the Long-Term Agreement will not change as a result of concluding the Amendment, the total value of supplies to Elektrownia Kozienice will, however, increase in 2021-2027 by the value of Additional Agreement No. 2.
Another partial determination of the terms and conditions of supplies for 2021 due to conclusion of the Additional Agreement No. 2 and the Amendment to the Long-Term Agreement is a result of the current situation in the sector producing electric energy from hard coal.
Additional Agreement No. 2 provides for the following liquidated damages:
- if quality parameters of supplied coal batches fail to comply with border parameters specified in the agreement, the Buyer is entitled to apply liquidated damages the amount of which shall be determined depending on the level of exceeding the parameter;
- if the amount of coal specified in Additional Agreement No. 2 is not delivered or not collected, liquidated damages shall be calculated as 20% of the net value of undelivered or uncollected amount of coal.
Due to relatively short term of Additional Agreement No. 2, the Parties do not provide for the possibility of its termination.
Other terms and conditions of Additional Agreement No. 2 do not differ from the market conditions applied in such agreements.
The Management Board treats the above information as significant given the dominant share of the recipient in the Company’s supply portfolio.