KGHM Polska Miedź S.A.

M&A Activity • Jul 28, 2016

Discontinuance of the Project to build a gas-steam block in "ElektrowniaBlachownia Nowa" sp. z o.o.

In reference to regulatory filing no. 38/2013 dated 30 December 2013, ontemporary suspension of the project to build a gas-steam block in thecompany "Elektrownia Blachownia Nowa" sp. z o.o., the Management Boardof KGHM Polska Miedź S.A. announces that on 28 July 2016 KGHM PolskaMiedź S.A., TAURON Polska Energia S.A. ("TAURON") and TAURON WytwarzanieS.A. (a subsidiary of TAURON) (hereafter: "Parties") signed an agreement("Agreement"). Based on the Agreement, the Parties agreed to discontinuethe project to build a gas-steam block in "Elektrownia Blachownia Nowa"sp. z o. o ("Project") and to terminate the Shareholders Agreementbetween KGHM Polska Miedź S.A. and TAURON Wytwarzanie S.A, resulting inan extinguishment of all obligations stipulated in the ShareholdersAgreement and termination of all work stipulated in it, in particularthose stipulated in the provisional schedule for the realisation ofProject, as well as those in subsequent agreements and arrangements.

KGHM Polska Miedź S.A. and TAURON Wytwarzanie S.A. agreed to liquidatethe company "Elektrownia Blachownia Nowa" sp. z o.o. The liquidationwill be carried out in accordance with the stipulations of the Company'sArticles of Association and laws in force.

The Parties will cooperate with each other and with "ElektrowniaBlachownia Nowa" sp. z o.o, to ensure the execution of the Agreement.The Parties agreed to terminate their agreement dated 30 December 2013,based on which it was decided to temporarily suspend the realisation ofthe Project to build a gas-steam block in the company "ElektrowniaBlachownia Nowa" sp. z o.o.

Legal basis: Art. 17 (1) of MAR (Regulation (EU) No 596/2014 of theEuropean Parliament and of the Council of 16 April 2014 on market abuse(market abuse regulation) and repealing Directive 2003/6/EC of theEuropean Parliament and of the Council and Commission Directives2003/124/EC, 2003/125/EC and 2004/72/EC (Official Journal of theEuropean Union dated 12 June 2014, no. L 173/1)