Orlen to address burning issues

As a result of the fire that broke out last week in Mazeikiu Nafta, the Lithuanian oil refinery is now running at a mere 44 percent of its normal 197,000 barrels per day crude-distillation capacity. In only a couple of minutes the fire destroyed a 50-meter high vacuum pipe tower distillation column.

Mazeikiu's spokesman Giedrius Karsoksas said the damage will take months to repair.

PKN Orlen, which is in the process of taking over Mazeikiu Nafta but is not yet its formal owner, offered its assistance in coping with the effects of the fire. At the end of May this year the company signed an agreement for the purchase of 54 percent of shares in Mazeikiu from the Russian concern Yukos for $1.5 (zł.4.7) billion and 30 percent of shares from the Lithuanian government for $852 (zł.2,653) million.

During a teleconference with market analysts on Friday, Igor Chalupec, CEO of PKN Orlen, reported that the signing of the agreement to finance the purchase of Mazeikiu will be postponed.

"We will analyze in detail the impact of this incident on the operating capacity of the Mazeikiu refinery and the company's profitability. We will also analyze the report of the commission established in Lithuania to determine the causes of this incident," reads PKN Orlen's official communique.

For the last couple of months Mazeikiu Nafta has been cut off from Russian oil as a result of the failure of the "Friendship" pipeline. Oil has instead been transported to Mazeikiu on ships. (Reuters)