La participació en activitats fora de l’horari escolar

SOCIAL RESPONSIBILITY II ENVIRONMENTAL RESPONSIBILITY III BUSINESS RESPONSIBILITY

Creating values beneficial to social environments

Creating values beneficial to the natural environment

Creating economically beneficial values

We are committed to respect for intellectual capital and

diversity, and respect for human rights, including the

freedom of speech and freedom of association. We contribute to the creation of

new jobs and the improvement of the quality of

human capital in the areas of our impact. We actively counteract exclusion and other social problems in the spheres of our competences.

We strive to continuously reduce the negative impact of our business on the environment through the application of high standards of

extraction, production and processing of hydrocarbons, and also by meeting the demanding environmental standards in production, transportation and sale of

petroleum products. In our upstream operations we employ the best available techniques and rules of conduct, constantly analysing the opportunities offered in this area

by new technologies. We also aim to identify and develop opportunities for obtaining energy

from renewable sources.

We place great importance on the management of our relations with the environment in a predictable and reliable manner, consistently with the principles of ethics and in keeping with the rules of transparency and partnership. This has an impact on the way in which we

aim to profit and increase in value in the long term perspective. Our responsibility manifests itself in our initiation of activities aimed at increasing security in the

energy sector in a responsible manner, both towards society and the environment. We provide a stable supply of fuel to the market, as well as participate in the

exploration and production of hydrocarbon deposits, including unconventional ones.

Grupa LOTOS S.A. - Integrated Annual Report 2012

LOTOS Integrated Annual Report 2012 / Sustainable development / The Environment / Environmental policy

Environmental policy

As stated in the declaration included in our mission, the LOTOS Group aims at conducting all areas of its business in a sustainable manner, with respect for the environmental conditions specified by law, and in keeping with the code of Corporate Social Responsibility (CSR).

Our environmental policy is focused on clean production, understood as a continuous effort to reduce the consumption of utilities and raw materials, reduce emissions, manage waste effectively, as well as to ensure the safety of industrial processes for effective prevention of plant failures. We apply the prudence principle by identifying and properly managing risk on all stages of our business activities, starting from exploration & production, to planning and executing operational activities, to marketing. When assessing individual risks, we take into consideration their potential environmental impacts, people's health and safety, etc. We review the risks, together with the assessment of their environmental impact, also when executing individual projects, including investment undertakings. Preventive measures put in place depend on the detailed analysis of all risks and their importance for the functioning of the entire organization and its external

environment.

Application of the principle of sustainable development and social responsibility in business translates into the production of high quality products with the lowest possible impact on the environment in the place of their use.

Environmental responsibility is one of the three most important areas of our social responsibility strategy, and also supports us in reaching business objectives in each segment of our activities.

The key objective of the LOTOS Group’s CSR Strategy in the area of natural resource management in the production process is to reduce environmental risk and strive to continually minimise the degree of negative impact on the environment.

Achievement of the objectives of the CSR Strategy is subject to monitoring in the periods that coincide with the assessment of the level of implementation of the LOTOS Group’s business strategy.

In addition, the vast majority of companies in the LOTOS Group, being a part of an integrated management system, are operating within a certified environmental management system, compliant with the requirements of the PN-N-14001 standard. The system assumes the existence of functioning procedures for the identification of environmental aspects at all stages of business, the setting of environmental tasks and objectives and proper control of waste management, as well as the monitoring of processes and activities that have an impact on the environment. A detailed plan for

environmental monitoring of all areas of our operations is also clearly defined. If any deviations from the assumed parameters are identified, immediate corrective action is undertaken and suitable preventative measures implemented in case of any potential environmental risk.

Treating environmental protection as one of the key distinguishing features of the company’s culture is additionally reflected in our Code of Ethics, which has been in force since 2013.

Conducting business in a manner that promotes environmental protection and mitigates the environmental footprint of the LOTOS Group’s industrial facilities, which could affect the well-being of the people living in their vicinity, are among our key priorities. We are intent on developing in a sustainable manner, with due regard for the needs of future generations. We use natural resources and energy rationally, while employing

environmentally friendly technologies, which meet the criteria of Best Available Techniques. We also seek to promote environmentally responsible attitudes among our employees.

Compliance with environmental policy is demonstrated by:

Adherence to internal procedures intended to ensure the conformity of our processes with the requirements imposed by applicable environmental laws;

Implementation of solutions designed to mitigate the LOTOS Group's environmental impact;

Involvement in educational initiatives seeking to create environmental awareness both within the organisation and in a wider social context;

Care for the environment in and outside of the workplace.

Source: The LOTOS Group’s Code of Ethics

As a company aware of the scale and character of its impact, we have declared that we should follow the international standards for enterprises which manage their environmental impact responsibly. This is confirmed by public support and our commitment to the application in all our activities of the rules set by the world's largest organisations promoting the ideas of social and environmental responsibility, such as the UN Global Compact. As a member of the UN Global Compact, Grupa LOTOS:

Takes a preventive approach to the natural environment,

Undertakes initiatives aimed at promoting environmental responsibility, Applies and promotes environmentally friendly technologies.

All issues related to environmental protection are managed in Grupa LOTOS by a dedicated organisational unit. In addition to monitoring the scope of the impact that the Company’s production facilities in Gdańsk have on the environment, analysing the quantity and quality compliance of emitted pollutants, generated waste, wastewater discharge and water or noise pollution, its role is also to coordinate efforts to comply with environmental legal requirements and to set standards for the environmental policy in the LOTOS Group.

Aspects of our business also require us to monitor CO emissions and undertake activities within the EU Emission Trading System. Monitoring and reporting of CO emissions from LOTOS Group installations has been conducted faultlessly.

In line with our strategy and commitments, we attach importance to encouraging appropriate environmental attitudes among our employees and in the social realm. Activities aimed at improving the knowledge and awareness of the challenges of environmental protection are realised in our internal training and educational programme, the LOTOS Academy, and through our work with higher education institutions, such as Gdańsk University of Technology, University of Gdańsk and AGH University of Science and Technology in Kraków, and also through interaction with industry-specific scientific research centres in Poland and abroad.

2 2

Grupa LOTOS S.A. - Integrated Annual Report 2012

LOTOS Integrated Annual Report 2012 / Sustainable development / The Environment / Impact on ecosystems

Impact on ecosystems

As part of its mission, the LOTOS Group pays a lot of attention to the condition of the environment as a whole, placing particular emphasis on how its activities effect change in the environment. The LOTOS Group undertakes various

measures to prevent and compensate for the possible effects of that impact. This policy is in force at all companies of the LOTOS Group.

The only production plant owned by the Grupa LOTOS is the oil refinery situated in the north of Poland, on the border

between the municipalities of Gdańsk and Pruszcz Gdański. The facility spreads over 2.35 km and the location is designated in the local spatial development plan as a built-in production and services area, for industrial facilities and warehouses. Apart from the refinery, there are warehouses and office buildings in the area, from which some of the LOTOS Group companies operate, including LOTOS Asfalt, LOTOS Oil, LOTOS Paliwa, LOTOS Lab, LOTOS Straż, LOTOS Ochrona and LOTOS Service.

The area owned by Grupa LOTOS is essentially of no environmental value and is not environmentally protected, either by Polish or EU environmental law. However, there are some areas in the neighbourhood of the refinery which are covered by various environmental protection regulations.

Nature Reserves

Ptasi Raj in Wyspa Sobieszewska: surface area 200 ha, 2.5 km away from the plant; Mewia Łacha in the Wisła estuary: surface area 150 ha, 13 km away from the plant.

Landscape parks:

Trójmiejski Park Krajobrazowy (Tricity Landscape Park) surrounding Gdańsk, Sopot and Gdynia from the east; surface area 19,930 ha, 15 km away from the plant;

Nadmorski Park Krajobrazowy (Seaside Landscape Park) stretching from Białogóra in its western part to the Hel Peninsula in the east, and including the eastern shore of Zatoka Pucka; surface area 18,804 ha, 43 km away from the plant;

Park Krajobrazowy Mierzeja Wiślana (Mierzeja Wiślana Landscape Park) situated east of the refinery, stretching from Sztutow all the way to the Russian border in Piaski; surface area 4,410 ha, 35 km away from the plant.

Natura 2000 areas

Wisła estuary (PLB220004, continental),

Zatoka Pucka (Puck Bay) (PLB220005, continental),

Twierdza Wisłoujście (Wisłoujście Fortress) (PLH220030, continental), A mainstay in the Wisła estuary (PLH220044, continental).

The Natura 2000 areas coincide with the areas of the nature reserves and landscape parks.

The LOTOS Group companies, operating in the south of Poland, such as LOTOS Czechowice, LOTOS Jasło, LOTOS Biopaliwa, RCEkoenergia neither own, lease nor manage any grounds that are in the direct vicinity of nature reserves,

landscape parks or Natura 2000 areas, or any other areas valued for their biodiversity. There are, however, two environmentally relevant areas in the neighbourhood of LOTOS Czechowice, LOTOS Biopaliwa and RCEkonergia:

The Rotuz nature reserve, 6 km west from the border of the plant; surface area 28.21 ha. Protected spa area in Goczałkowice Zdrój, 4 km away from the plant's borders.

The potential impact of the LOTOS Group’s sites on biodiversity are also analysed in the case of three Petrobaltic Group oil and gas producing entities. LOTOS Petrobaltic licence areas in the Baltic Sea are not situated in protected areas.

Biodiversity in oil and gas extraction areas is very low, so the impact of work taking place in the waters of Polish

economic zones is negligible. In the case of LOTOS Geonafta, licences and other areas managed by the Company are

not located in protected zones. According to Lithuanian law, only prospecting (seismic) works can be carried out in protected areas or in areas of high biodiversity, but no extraction, as such, is allowed. Also, the licences and areas on the Norwegian Continental Shelf that were explored by LOTOS Norge in 2012 are not located anywhere near protected

or high-biodiversity areas.

Energobaltic, another Petrobaltic Group company, is located in the northern part of Władysławowo in the industrial harbour area, occupying a surface of 24,000 m and owned by the State Treasury and leased out to the company in perpetual usufruct. It is situated right at the base of the Hel Peninsula in the conservation area of Nadmorski Park Krajobrazowy and in direct vicinity of the Natura 2000 areas. As provided for by the local spatial development plan, the nearby areas, along provincial road 216 are designated for nuisance trades. There are meadows spreading behind the road, which border Zatoka Pucka, and are part of the Słone Łąki Nature Reserve.

LOTOS Asfalt has at its disposal industrial land located in Gdańsk, Jasło and Czechowice Dziedzice which the company holds in perpetual usufruct or under lease agreements from other businesses. These areas are situated within the land belonging to Grupa LOTOS, LOTOS Jasło and LOTOS Czechowice. The LOTOS Asfalt areas and their direct vicinity are not regulated by any form of environmental protection, nor are there are any facilities or areas nearby that are similarly protected.

At LOTOS Paliwa, in the process of preparing new facilities for operation in the LOTOS station chain, the environmental

protection documentation has also been reviewed. An Environmental Impact Assessment Report was prepared for each newly built station, which includes analysis of the station’s location in relation to protected areas or any other areas of biodiversity, and a risk analysis of the possible impact of the station on the environment. Based on the analysed documentation and site visits it was concluded that LOTOS chain facilities were mostly located within towns and cities, away from protected areas.

LOTOS Kolej based in Gdańsk had its Environmental Impact Assessment Reports prepared at the investment stages, with the potential impact of the planned facilities on the neighbouring areas thoroughly investigated, with special focus on the protected and significantly biodiverse areas. No such areas were identified anywhere near the new facilities.

Both Polish and EU law are designed to ensure that restrictions imposed on production plants guarantee the lowest possible impact of their activities on biodiversity in nearby areas, while at the same time not generating irrational costs. Grupa LOTOS refinery and all other companies that belong to the LOTOS Group, depending on their production profile, ensure that they meet all the requirements defined in their integrated and sectoral permits. The standards defined in the permits mostly regard monitoring and reporting of air quality around the plant, wastewater, gas and noise emissions and waste management. Ensuring that these conditions are maintained guarantees that the protected areas neighbouring the plants, as described above, will not be adversely affected in any way.

Similarly to plant operating conditions, the law also regulates the parameters that refinery products need to have before they are introduced to market. This guarantees that when used correctly, they will not have excessive negative impact on the environment or biodiversity.

The LOTOS Group ensures that it does not expand in any way that is detrimental to natural habitats, or that it has any other adverse effect on the natural habitats situated in the neighbourhood of its investments. This guarantee can be provided because issues of biodiversity are included in the specialist environmental impact assessments prepared prior to each of our investments.

In fact, the LOTOS Group companies' presence can be discussed in terms of their positive impact on the lives of the people who live near their plants, and Energobaltic's activities are a good example of such operations. The company's CHP plant has considerably reduced exhaust emissions from local coal boilers, while low-waste technologies have allowed us to avoid combustion waste, such as slag and dust. Continuous monitoring of underground waters confirms the stability of their content, which remains well within prescribed standards. This is particularly important because the plant is close to the beach and sea, has a nature reserve in its vicinity, Natura 2000 lands and the Nadmorski Park Krajobrazowy (Seaside Landscape Park).

Grupa LOTOS S.A. - Integrated Annual Report 2012

LOTOS Integrated Annual Report 2012 / Sustainable development / The Environment / Mitigating the environmental impact

Mitigating the environmental impact

- data has been verified, full text of the Independent Assurance Report (/en/the-organization-and-its-report/integrated-reporting/auditing-and- reviews#opinia-pwc)

The LOTOS Group’s Business Strategy for 2011-2015 envisages that we will exclusively endorse environmentally friendly technologies, based on the best solutions available, with characteristically low emissions and highly efficient production processes.

In line with its strategic objectives, the LOTOS Group is especially concerned with gas emissions, which are the most critical source of environmental nuisance, both for the immediate environment of the LOTOS Group’s plants and other areas located further away. This particular focus does not only stem from legal regulations in this area or from our own wish to reduce negative impact on the Company’s immediate natural environment. An essential role is also played by the economic aspect, just as the Polish and EU laws have been designed to ensure that in the long run reduced emissions and lower emissions by industrial plants will bring measurable financial benefits. In fact, all technological changes in the LOTOS Group are planned to meet the criteria of the Best Available Techniques (BAT), which in most cases, is

associated with the fulfilment of the conditions specific to the three areas mentioned earlier.

As far as emissions from industrial plants are concerned, stakeholders take the greatest interest in greenhouse gases, including carbon dioxide (CO ), methane (CH ), nitrous oxide (N O), fluorinated hydrocarbons (HFC), perfluorinated hydrocarbons (PFCs) and sulphur hexafluoride (SF ). It is commonly believed that the excessive emission of these gases into the atmosphere is one of the main causes of the currently observed global warming. In order to counteract global warming, a number of agreements and protocols have been established, which oblige the participating countries to reduce their emission of greenhouse gases to a specific level in a given period. The main document regulating the reduction of greenhouse gas emission is the Kyoto Protocol, the first version of which was negotiated in 1997. The document came into force in 2005 after being ratified by 141 countries.

A direct consequence of the Kyoto Protocol for the European Union is the introduction of the emissions trading system (ETS/EU ETS), in which Grupa LOTOS, LOTOS Asfalt, RCEkonergia and Energobaltic have actively participated from the very beginning, successfully meeting its requirements and abiding by its restrictions. The

general idea behind the ETS is to motivate plants to reduce emissions in one of several possible ways, which involve the need to purchase fewer emission allowances, and thus bring specific economic benefits.

In order to standardise the method for determining emissions levels in the EU, the industrial plants that participate in the ETS are obliged to perform measurements and report emissions in one of the recommended ways. As far as burning of