8.6. Joint operations
Accounting policies
In relation to its interest in joint operations, the Group, as a joint operator, recognises in its financial statements:
- its assets, including its share of any assets held jointly,
- its liabilities, including its share of any liabilities incurred jointly,
- its revenue from the sale of its share of the output arising from the joint operation;
- its share of the revenue from the sale of the output by the joint operation; and
- its expenses, including its share of any expenses incurred jointly.
As assets, liabilities, revenues and costs relating to the joint operation are also disclosed in the separate financial statements of the party, these items are not subject to adjustment or other consolidation procedures when preparing consolidated financial statements of that party.
Figure 2 Countries where the Group conducts joint operations
The Group is involved in joint operations mainly in Poland, and also in Germany, Norway, and Pakistan. Joint operations comprise mainly exploration for and production of natural gas and crude oil, except for operations conducted in south-east Poland, where they involve an initial stage of exploration for unconventional deposits of gas.
Material estimates
As at the end of the reporting period, the Group was involved in joint ventures, as defined in IFRS 11, as part of projects carried out in Norway in the PL703 and PL856 exploration licence areas, of which, considering all facts and circumstances, it had joint control.
As at December 31st 2015, the Group also held interests in other licences on the Norwegian Continental Shelf, covering, among others, the Skarv, Gina Krog, Morvin, Vilje, and Vale fields. Considering the IFRS 11 criteria, the Group’s operations in the above fields do not represent joint arrangements as defined in the standard and the Group does not have joint control of the operations as there is more than one combination of parties that can agree to make significant decisions. Therefore, for the purpose of correct recognition and measurement of transactions related to the operations in those fields, the Group applies other relevant IFRSs taking into account its interest in the fields, which ensures that there are no material differences in the accounting recognition and measurement of transactions related to these operations and the manner of recognising operations which are carried out jointly with the PL703 and PL856 licence interest holders and meet the definition of joint operations within the meaning of IFRS 11.
For more information on joint operations, see Sections 5.1.3. and 5.1.4. of the Directors’ Report on the operations of PGNiG S.A. and the PGNiG Group in 2016.
A detailed list of joint operations in which the Group is involved is presented in the tables below.
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| 2016 | |||
|---|---|---|---|
| Name of joint contractual arrangement | Country where joint operation is conducted | Interests in joint operations | Business of joint operations |
| Joint operation in the Sieraków licence area | Poland | PGNiG S.A. 51%; Orlen Upstream Sp. z o.o. 49% | Oil and gas exploration and production |
| Joint operation in the Płotki-PTZ (the Extended Zaniemyśl Area) licence area | Poland | PGNiG S.A. 51%; FX Energy 24.5%; Cal Energy 24.5% | Oil and gas exploration and production |
| Joint operation in the Kamień Pomorski licence area | Poland | PGNiG S.A. 51%; LOTOS Petrobaltic S.A. 49% | Oil and gas exploration and production |
| Joint operation in the Górowo Iławieckie licence area | Poland | PGNiG S.A. 51%; LOTOS Petrobaltic S.A. 49% | Oil and gas exploration and production |
| Joint operation in a subdivision of the Lubben licence area in east Germany (Brandenburg) | Germany | PGNiG S.A. 36%; Central European Petroleum Gmbh 39%;Rohöl-Aufsuchungs AG 25% | Oil and gas exploration and production |
| Joint operation in the Poznań licence area | Poland | PGNiG S.A. 51%; FX Energy 49% | Oil and gas exploration and production |
| Joint operation in the Płotki licence area | Poland | PGNiG S.A. 51%; FX Energy 49% | Oil and gas exploration and production |
| Joint operation in the Bieszczady licence area | Poland | PGNiG S.A. 51%; ORLEN Upstream sp. z o.o. 49% | Oil and gas exploration and production |
| Joint operation in the Warszawa-Południe licence area (blocks 254 and 255) | Poland | PGNiG S.A. 49%; FX Energy 51% | Oil and gas exploration and production |
| Joint operation covering part of Przedsudecka Monocline | Poland | PGNiG S.A. 51%; FX Energy 49% | Oil and gas exploration and production |
| Joint operation in the Kirthar licence area | Pakistan | PGNiG S.A. 70%; Pakistan Petroleum Ltd. 30% | Oil and gas exploration and production |
| Joint operation in the PL703 licence area | Norway | PGNiG UI 40%, OMV 60% | Oil and gas exploration and production |
| Joint operation in the PL856 licence area | Norway | PGNiG UI 25%, Capricorn 75% | Oil and gas exploration and production |
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| 2015 | |||
|---|---|---|---|
| Name of joint contractual arrangement | Country where joint operation is conducted | Interests in joint operations | Business of joint operations |
| Joint operation in the Płotki licence area | Poland | PGNiG S.A. 51%; FX Energy 49% | Oil and gas exploration and production |
| Joint operation in the Płotki-PTZ (the Extended Zaniemyśl Area) licence area | Poland | PGNiG S.A. 51%; FX Energy 24.5%; Calenergy Resources Poland 24.5% | Oil and gas exploration and production |
| Joint operation in the Poznań licence area | Poland | PGNiG S.A. 51%; FX Energy 49% | Oil and gas exploration and production |
| Joint operation in the Bieszczady licence area | Poland | PGNiG S.A. 51%; ORLEN Upstream sp. z o.o. 49% | Oil and gas exploration and production |
| Joint operation in the Sieraków licence area | Poland | PGNiG S.A. 51%; Orlen Upstream Sp. z o.o. 49% | Oil and gas exploration and production |
| Joint operation in the Kamień Pomorski licence area | Poland | PGNiG S.A. 51%; LOTOS Petrobaltic S.A. 49% | Oil and gas exploration and production |
| Joint operation in the Górowo Iławieckie licence area | Poland | PGNiG S.A. 51%; LOTOS Petrobaltic S.A. 49% | Oil and gas exploration and production |
| Joint operation in the Warszawa-Południe licence area (blocks 254 and 255) | Poland | PGNiG S.A. 49%; FX Energy 51% | Oil and gas exploration and production |
| Joint operation in a subdivision of the Lubben licence area in east Germany (Brandenburg) | Germany | PGNiG S.A. 36%; Central European Petroleum Gmbh 39%;Rohöl-Aufsuchungs AG 25% | Oil and gas exploration and production |
| Joint operation in the Kirthar licence area | Pakistan | PGNiG S.A. 70%; Pakistan Petroleum Ltd. 30% | Oil and gas exploration and production |
| Joint operation in the PL702 licence area | Norway | PGNiG UI 40%, OMV 60% | Oil and gas exploration and production |
| Joint operation in the PL703 licence area | Norway | PGNiG UI 40%, OMV 60% | Oil and gas exploration and production |
- 8.1. Share capital and share premium
- 8.2. Earnings per share
- 8.3. Assets held for sale
- 8.4. Other assets
- 8.5. Contingent assets and liabilities
- 8.6. Joint operations
- 8.7. Changes in the Group structure in the reporting period
- 8.8. Business combinations
- 8.9. Other important information
- 8.10. Events subsequent to the end of the reporting period
