Lotus co-finance agreement for development of Baltic oil field

Lotus Petrobaltic (LPB), a company of the Lotus group, and Polish Investments for Development (PIR) have agreed to co-finance the development of a Baltic oil field known as B8.

“We are delighted to be working with Polskie Inwestycje Rozwojowe, and we appreciate their input,” Paweł Olechnowicz, CEO of Lotus group, was quoted as saying in the company’s press release.

Lotus plan to commence commercial production from the B8 field in 2015, hoping for a yield of 220,000 tons of crude oil per annum. The field’s total reserves are estimated to be 3.5 mln  barrels. The development of the field has so far has been entirely financed by Lotus.

The agreement will involve the creation of a special purpose vehicle, a wholly-owned subsidiary of LPB which will carry out the remaining work. Lotus Petrobaltic will hold the production license for the field, and third-party finance will be provided by commercial banks.

PIR was founded under the Polish Investments Program, a scheme set up by Donald Tusk’s Civic Platform (PO) government aimed at securing long-term infrastructure spending in Poland. The company provides funding to low- or medium-risk projects, with a view to driving GDP growth and creating jobs in Poland.

“Our involvement in the B8 field production project in the Baltic Sea is fully consistent with the goals of Polskie Inwestycje Rozwojowe S.A.,” said Mariusz Grendowicz, President of PIR, as quoted in the Lotus press release.