Orlen and Krajowa Grupa Spożywcza sign a memorandum on biomethane production

Orlen and Krajowa Grupa Spożywcza (KGS), the largest state-owned food producer, signed in July 2025 a memorandum on developing biomethane production technology. The document does not indicate a specific installation, capacity or volume, but announces cooperation at the interface of the energy sector and the agri-food industry, in which waste and residues become a feedstock for biomethane plants.

What the agreement provides for

The feedstock is to be agricultural and production waste from the resources of both companies. The partners intend to secure land on which digestate can be applied as fertiliser. The first step is the identification of suitable locations – first on land owned by KGS, without excluding others. The next stages are obtaining administrative permits and certificates confirming the origin of the fuel. No timetable was given.

The same material recalled Orlen's targets: up to 0.24 billion m³ of biomethane a year by 2035 within the National Indicative Target. In Głąbów (Warmian-Masurian Voivodeship) the company is building a PGNiG BioEvolution installation that is to produce more than 7 million m³ of biomethane a year with a bioLNG module to supply trucks, and it operates biogas plants in Konopnica, Buczek and Wojny-Wawrzyńce.

Why this matters

Combining a fuel group with a food producer resembles a model known from other countries: processing plants have a steady stream of residues (pomace, pulp, animal waste), and the energy sector brings capital and access to the gas and fuel market. For state-owned companies it is also a way of achieving RES targets in transport, because the National Indicative Target obliges fuel producers to place renewable fuels on the market.

Significance for the industry in Poland

The memorandum signals that state-owned companies treat biomethane as part of their strategy, not a niche product. For farmers – feedstock suppliers – growing interest from large players means, on the one hand, new contracts and, on the other, greater competition for substrates and for land for digestate. For independent investors it is a pointer that the market will require well-secured feedstock agreements.

What next

The memorandum is a document of intent and until agreements, environmental decisions and connections appear it does not determine that specific installations will be built. The next stages are an analysis of locations, a substrate balance and arrangements with the grid operator. It will be worth watching whether other KGS partners join the talks and whether the project is linked to the new biomethane support system, whose start still depends on the act.