8.8 Events after the reporting date

Gazprom 2017 Request was submitted in response to PGNiG’s request of November 1st 2017 to reduce the contract price (“PGNiG 2017 Request”).

Gazprom 2020 Request was submitted in response to PGNiG’s request of November 1st 2020 for reduction of the contract price, subsequently modified by PGNiG on October 28th 2021 (“PGNiG 2020/2021 Request”).

In the opinion of PGNiG, the request to increase the contract price under Gazprom 2017 Request and Gazprom 2020 Request is entirely without merit, which PGNiG has demonstrated in PGNiG 2017 Request and PGNIG 2020/2021 Request, which contained a demand for the contract price to be reduced.

In accordance with the rules of arbitration applicable to arbitration proceedings initiated as a result of the Gazprom Call, the Company is required to take further steps on the matter (including to submit a response to the Gazprom Call) within 30 days from the date of receipt of the call. PGNiG will take appropriate steps within the prescribed time limit.

ORLEN Południe S.A. and PGNiG S.A. will hold 51% and 49% of shares in the joint venture, respectively.

W tworzonym podmiocie ORLEN Południe S.A. i PGNiG S.A będą mieć odpowiednio 51% i 49% udziałów.

The second respondent named in the Gazprom Call, in addition to PGNiG, is EPG. In the Company’s opinion, the demands contained in the Gazprom Call are entirely without merit. PGNiG exercises its rights and obligations as a shareholder of EPG in accordance with the provisions of applicable law, while the decisions concerning the distribution of net profit for a given financial year are made by the general meeting of EPG.

PGNiG holds, directly and indirectly through its subsidiary GAS-TRADING S.A., 51.18% of shares in EPG, while 48.82% of shares are held by Gazprom. The amount of EPG’s earnings retained from previous years, available for distribution to shareholders, is PLN 1.74bn.

In accordance with the rules of arbitration applicable to arbitration proceedings initiated as a result of the Gazprom Call, the Company is required to take further steps on the matter (including to submit a response to the Gazprom Call) within 30 days from the date of receipt of the call. PGNiG will take appropriate steps within the prescribed time limit.

In addition, if the ad hoc Arbitration Tribunal determines that the contract price was permissible to change in 2017, the Company filed a counterclaim to reduce the contract price as of November 1st 2017, based on PGNiG’s November 1st 2017 request to reduce the contract price.

The Company also filed a counterclaim to reduce the contract price from November 1st 2021, as part of PGNiG’s request of November 1st 2020 to reduce the contract price, subsequently modified by PGNiG on October 28th 2021.

In Ukraine the PGNiG Group operates through the PGNiG SA Representative Office in Kiev, the Exalo Drilling Group (Exalo Drilling Ukraine LLC) and LLC Karpatgazvydobuvannya (exploration and production activities carried out in cooperation with ERU Management Services). As at the date of this Report, the value of assets engaged in Ukraine did not represent a material part of the Group’s total assets. Employees of the PGNiG Group and their families have been evacuated from areas at risk of being affected by the military conflict.

For more information on the impact on the Group’s business, see the Directors’ Report the operations of the PGNiG Group and PGNiG S.A. for 2021.

Pursuant to the Annex, the deadline for the performance of Abener Energia’s obligations, the non-performance of which would be a condition precedent to the termination of the Settlement, including the submission of apostilled documents confirming the consent of the pledgees (whose pledges encumber the claims due to Abener Energia under the Arbitration Court Judgment) to the conclusion of the Annex has been extended from February 28th 2022 to March 7th 2022.

Under the Annex Abener Energia is required to provide an unconditional and irrevocable consent of the judicial authority, court commissioner, administrator or other competent authority designated by the Spanish court conducting insolvency proceedings against Abengoa S.A., to execute and perform this Annex by March 4th 2022.

ECSW is required to submit a resolution of its supervisory board approving the execution of the Annex by March 4th 2022.

PGNiG indirectly holds a 50% equity interest in ECSW through its subsidiary PGNiG TERMIKA S.A.

On March 8th 2022, the Management Board of PGNIG S.A. was notified that the terms of the settlement had been fulfilled and the parties proceeded to execute the Settlement.

Pursuant to Art. 70c.3.1 of the Act of February 16th 2007 on Stocks of Crude Oil, Petroleum Products and Natural Gas, and on the Rules to Be Followed in the Event of Threat to National Fuel Security or Disruptions on the Petroleum Market (the “Act”), upon execution of the Agreement the GASR will purchase from PGNiG, for the State Treasury, natural gas held as emergency stocks at the price specified in the Act, and will assume PGNiG’s rights and obligations under storage contracts with the storage system operator with respect to emergency stocks.

Gas will be sold to RARS for the purpose of maintaining mandatory stocks at the price specified in the Act, corresponding to the arithmetic mean of settlement prices under supply contracts planned in Q2 and Q3 2022, as quoted in the last 30 calendar days immediately preceding the date of transfer of ownership of natural gas, published on the website of the company operating the Polish Power Exchange.2022 Pursuant to the Act of January 26th 2022 on Special Solutions for the Protection of Gas Fuel Customers in View of the Situation on the Gas Market, GASR’s expenditure on the activity referred to in Art. 70c.3.1 of the Act is capped at PLN 6bn in 2022.

Energy companies operating in Poland, whose business consists in gas trading with foreign partners, and entities importing natural gas are required to maintain emergency stocks of natural gas in an amount equal to at least 30-day average daily imports.

PGNiG Obrót Detaliczny is one of the entities entitled to receive the Compensation.

In the judgment, the Stockholm Court of Appeals:

1. dismissed Gazprom’s complaint as unfounded in its entirety, i.e. to the extent it alleged that the ad hoc Arbitration Tribunal, in deciding to reduce the contract price for gas supplied under the Yamal Contract, exceeded the powers granted to the Tribunal by PGNiG and Gazprom in the Yamal Contract and awarded PGNiG the costs of legal representation. and
2. ordered Gazprom to reimburse the legal representation costs to PGNiG.

The judgment is not final as, in accordance with section 43(2) of the Swedish Arbitration Act 1999, the Stockholm Court of Appeal granted permission for the award to be appealed to the Supreme Court, considering the case to be precedent-setting.

The approval granted by the Polish antitrust authority is subject to the condition that PGNiG and ORLEN will implement a remedial measure involving their commitment to sell the controlling interest in the subsidiary Gas Storage Poland sp. z o.o. of Dębogórze (“GSP”) to an independent investor within 12 months from the date of the Company’s merger with ORLEN, within the meaning of Art. 493.2 of the Commercial Companies Code. Among the commitments proposed to be made by the Company and ORLEN is the one to execute an agreement, for a period of at least ten years, designating GSP or its legal successor as the operator of the gas fuel storage system owned by the entity formed through the merger of PGNiG and ORLEN. Currently, GSP is the operator of the gas fuel storage system in storage facilities owned by PGNiG.

Under the Agreement, PGNiG sold to GASR in favour of the State Treasury 10,063,104 MWhm of natural gas constituting emergency stocks, with a value of PLN 5,955m. Pursuant to the authorisations under the Act of January 26th 2022 on Special Solutions for the Protection of Gas Fuel Customers in View of the Situation on the Gas Market, GASR will pay the price in instalments, by August 31st 2022.

The agreement also contains provisions stipulating PGNiG’s obligation to repurchase natural gas in the event that the emergency stocks are released.