Profil:
Polimex Mostostal SAAzoty Pulawy chemicals still expects remedial programme from Polimex-Mostostal builder
Listed chemical group Azoty's unit, Azoty Pulawy, continues to expect a remedial programme from listed builder Polimex-Mostostal, which has not yet fulfilled the contract for the construction of the coal unit, with the original completion date being exceeded by more than two years, Grupa Azoty said in a press release. The amount of contractual penalties owed to Azoty Pulawy group for the delay currently reaches PLN 359 million (EUR 84 mln).
It was reported that the contractor's delay in the execution of the contract is 558 days as of December 13, 2024 (relative to the deadline indicated in the annex of July 13, 2023).
It was pointed out that, despite separately conducted analyses on the legitimacy of the decision taken in 2017 to build the coal unit, the company's management declared and continues to declare its willingness to cooperate for the completion of the investment.
Azoty Pulawy has already incurred PLN 1.1 billion (EUR 257.5 mln) of expenditures booked on the project (paid) since the beginning of construction, including start-up costs, and sees neither the end of the work nor the results.
"The company has, throughout the entire period of the contract for the construction of the 100 MW coal-fired unit, met all obligations and payments in a timely manner," Azoty Pulawy said in the press release.
"It has also cooperated with the contractor to complete the investment, despite the successive delays in the execution of the contract and the numerous technical and commissioning problems reported, which are the fault of Polimex-Mostostal," it added.
Azoty Pulawy group pointed out that it has incurred a number of additional costs related to the investment, its insurance, associated contracts, the cost of utilities, auxiliary materials, as well as the cost of capital, which was blocked.
It continued that Polimex-Mostostal has so far not presented any plan to solve the reported problems, apart from giving another distant completion date, thus making it clear that it does not believe in the success of the completion of the start-up of the unit.
On December 6, 2024, Azoty Pulawy presented the contractor with a guarantee of payment for the construction works in the amount of approximately PLN 2.3 million (EUR 538,430).
Importantly, on the same day, the District Court in Lublin granted security for the claims of Azoty Pulawy group by withholding the obligation to provide a guarantee of payment for the construction works covered by the contract to the extent exceeding the remuneration for the still uncompleted and unsettled construction works covered by the contract, i.e. above the amount of PLN 2,313,082 (EUR 541,493).
Thus, the level of guarantee requested by Polimex-Mostostal at over PLN 189 million (EUR 44.3 mln) gross, is currently unjustified.
"Azoty Pulawy group recalls that it has paid the contractor for almost 100 percent (99.96 percent) of the construction works provided for in the contract," the group stressed.
"The remaining amounts to be paid for minor finishing works for which a bank guarantee has been provided (including a guarantee for the execution and handover of as-built documentation) remain unpaid at least until the contractor performs these works," it added.
The group stated that its management will take steps to safeguard the company's interests and will present all claims arising from Polimex-Mostostal's actions.
The contract concluded on September 25, 2019, provided for the completion of the investment in the third quarter of 2022.
alk/ ao/ han/