PGE chief quits after row over $3.8bn coal project

Poland‘s biggest utility’s shares slumped after chief executive officer Krzysztof Kilian’s resignation due to a dispute over the $3.8bn Opole coal-fired power project.

PGE slumped 4.2 per cent to 18.58 zloty on Tuesday, falling for the first time in six days and cutting this year’s advance to 2.1 per cent.

The company was supposed to sign off a $3.8bn contract for the expansion of the Opole plant next month.

Krzysztof Kilian
Kilian resigned for “important reasons, including changes in management” last month, the Warsaw-based company said in a regulatory statement. The supervisory board on Oct. 25 fired Chief Financial Officer Wojciech Ostrowski and Strategy Chief Boguslawa Matuszewska from its four-member management, saying the evaluation of their work wasn’t “satisfactory.”

Kilian said in an interview on Oct. 28 that the decision was a sign of “no-confidence” in his management.

Piotr Szymanek, deputy CEO in charge of corporate issues, was appointed acting CEO yesterday, according to PGE’s filing.

Kilian, who said in August power prices should increase by about 50 per cent for the Opole project to be profitable, lobbied for the government to introduce capacity market and guaranteed price contracts to help build power units.

The supervisory board will start procedures to pick a new CEO and other management board members tomorrow, Agnieszka Jablonska-Twarog, a Treasury Ministry spokeswoman, said in an e-mailed response to Bloomberg questions.

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