Hellenic Petroleum (ELPE) is moving ahead with radical changes transforming the country's leading oil refinery into a group that will draw a large part of revenues from Renewable Energy Sources (RES), with investments of 3.5-4 billion euros by 2025.
At the same time, a change in the structure of the group will take place, with the establishment of a holding company, which will have a new name without the word "petroleum" included, while its corporate governance is being adapted to the relevant 2020 law and abolishes, among other things, the right of the state to appoint the majority of board members.
Presenting the transformation plan "Vision 2020 - 2025", the top executives of ELPE, president Giannis Papathanassiou and managing director Andreas Siamisis, commented on criticism from opposition parties and trade unions on the proposed changes to the articles of association that will be discussed at the general shareholders assembly May 20 that include dropping the appointment of 7 board members by the state, two members by the employees and two by the minority shareholders.
Papathanassiou described reactions as being unjustified, as the company adapts to the recent law on corporate governance, which provides for mandatory adjustment by mid-July. The new law, as explained by Papathanassiou and Siamisis, does not allow a shareholder to appoint more than 2/5 of the members of the board of directors. The law gives the option, which is used by the management of ELPE, to elect the board of directors from all shareholders, through the general meeting.
ELPE is moving forward with a strategic repositioning of the company in view of the transition to green power. In this context, with investments of 3.5 to 4 billion euros by 2025, the group will reduce its environmental footprint and will invest in Renewable Energy Sources.
"Living with our glorious past is not enough, we must plan for the future, take into account the market conditions that are shaping today," said Siamisis.
As the CEO of ELPE explained, today the group is dependent on refining margins and the dollar, while even the best CEO has a limited impact on the results. "New business pillars need to be created that will affect profitability," Siamisis said, proposing a shift to green energy and new technologies such as hydrogen, carbon dioxide capture, green hydrogen and biofuels.
New holding company, new brand
Although the decision has not been formally taken, Siamisis essentially confirmed that the group of ELPE will acquire a new structure, with the creation of a holding company.
In the same context, a change of the brand of the parent company of the group is foreseen, so that, as Siamisis characteristically pointed out, it goes hand in hand with the shift to renewable sources and consumers and markets see in the brand something more than "Petroleum".
These changes, as Siamisis explained, will have a direct financial impact for the group, as it will be easier, through the separation of activities, to raise funds from banks and markets.
Today, as he said, if the group wants to finance a large investment in RES, the financing becomes complicated, due to the fact that RES and refining activities coexist in the same corporate structure.