On 19 March 2019, the Management Board of PDH Polska S.A. adopted a resolution on the approval of the qualification of the bidder - Hyundai Engineering Co., Ltd. as a preffered bidder within the tender for the conclusion of a contract for the comprehensive implementation of the "Polymery Police" project according to the "turnkey" formula for a lump sum price.

The offer of Hyundai Engineering Co., Ltd. meets the requirements specified by PDH Polska S.A. in the tender documentation to the highest degree. The company will conduct further talks with the preffered bidder in order to agree on all the details of the implementation of the "Polymery Police" project, in particular in the scope related to the financing of this project and the insurance structure. 

Apart from the offer of Hyundai Engineering Co., Ltd. for the general contracting of the "Polymery Police" project, the offers were also submitted by: a consortium led by Technip Italy S.p.A. and a consortium led by Tecnimont S.p.A. 

- The project is of strategic importance for the Polish economy. Currently, Poland is an importer of polypropylene, and after the completion of our project, it will be an exporter. Police Polymers also means an increase in the country's energy and raw materials independence by opening a new liquid fuel terminal, creating a number of jobs for highly qualified staff and developing a base for the development of the Polish science and R&D sector. We would like Police Polymers to be the starting point for further development of the Group, as well as the Polish chemical sector, including related industries related to plastics processing - says Wojciech Wardacki, PhD, President of the Management Board of Grupa Azoty S.A. 

Based on an analysis of the bids, the amount of remuneration under the general contractor agreement for the Police Polymers project (basic scope) will not exceed EUR 1bn. This means that the total capital expenditure on the Project should not exceed EUR 1.18bn, according to the estimates made by PDH Polska S.A. as at the date of this report. This amount covers, in addition to the remuneration for the performance of the general contractor agreement, the capital expenditure incurred to date, site preparation, payment for technological licences, and purchase of catalysts. The total budget for the Project, including the cost of financing during the construction phase and the reserves required under the project finance model, should not exceed EUR 1.52bn. It is also currently assumed that during the operating phase PDH Polska S.A. will need additional working capital financing of EUR 176m. 

Based on the financial model, the Police Polymers project shows high economic viability despite an increase in its budget. 

- The situation on the polypropylene market is very favourable. The EU countries have recorded a deficit. In Poland, annual production amounts to about 290 thousand tons, with demand of nearly 700 thousand tons. We assume that our investment will help to reduce the national trade deficit in the area of plastics, and some of the surpluses will be exported to absorbent western markets - here the convenient location of the Police plants will help. The logistics-friendly location will also facilitate the supply by sea of raw materials for production, i.e. propane and ethylene - adds Wojciech Wardacki, PhD. 

In accordance with the agreed schedule of proceedings, the conclusion of an agreement with a selected contractor is planned for the second quarter of 2019, while the implementation of the Police Polymers project on the basis of the agreement concluded with the general contractor is to be completed in the fourth quarter of 2022. (a test start-up of the installation is planned for the second quarter of 2022). 

The "Polymery Police" project is a strategic undertaking of Grupa Azoty Capital Group implemented by PDH Polska S.A., a special purpose vehicle (SPV). "Polymers Police" is one of the largest chemical investments in this part of Europe. The aim of the project is to build a petrochemical complex, the scope of which will include:
 

- Propane Dehydrogenation (PDH) Unit;
- Polypropy- lene (PP) Production Unit;
- Polypropylene (PP) Logistics Infrastructure;
- Handling and Storage Terminal (gas terminal) and
- Auxiliary Systems

with an annual production capacity of 437 thousand tonnes of polypropylene. 

Both installations - PDH and PP - were designed on the basis of modern technologies (respectively: Oleflex from Honeywell UOP and Unipol from Grace Technologies), which enables high flexibility of production and delivery of a wide range of polypropylene types.