ROMANIA: The Hungarian company MOL negotiated the purchase of Lukoil’s businesses in Romania. The business, strongly discouraged by the Romanian state
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The Hungarian company MOL, controlled by the Viktor Orban government, negotiated with the Russian company Lukoil the possible purchase of some assets in Romania, official sources told Economedia and G4Media. Among the assets negotiated were the concession in the Black Sea (Trident perimeter) and the refinery in Ploiesti.
The representatives of MOL Romania told Economedia that they are “exploring both organic and inorganic development opportunities”.
Although they did not confirm or deny the Economedia information, the representatives of the Hungarian company told us last month that “MOL Romania is going through a period with many opportunities and our objective is to invest in growth initiatives that serve the interests of our B2B and B2C customers. We are constantly exploring both organic and inorganic growth opportunities and will certainly do our best to move forward with those we identify synergies with. Thank you for your inquiry, and should specific acquisitions take place or other growth opportunities be identified, we will return with detailed information.”
Lukoil representatives did not respond to Economedia’s questions.
However, the deal was “strongly discouraged” by the representatives of the Romanian state, according to Economedia sources. The reason is related to the suspicions regarding the actions of the government in Budapest, which would have ended up controlling both a strategic concession in the Black Sea and a significant slice of the refining market in Romania (around 20%). Previously, the BNR rejected a similar transaction, namely the Hungarian bank OTP Bank’s attempt to buy Banca Românească.
It is not clear at the moment if the talks between MOL Romania and Lukoil are continuing or have been stopped.
What Lukoil is doing in the Black Sea
The Russian company LukOil is the concessionaire of the Trident gas perimeter in the Black Sea, with estimated reserves of 30 billion cubic meters, but unconfirmed. Last year, the National Agency for Mineral Resources (ANRM), which concessions hydrocarbon perimeters on behalf of the Romanian state, approved the continuation of the exploration program for the Russians, given that the results of the drilling so far did not convince the Russians to start production proper.
The perimeter concessioned by Lukoil, in which Romgaz is a 12% partner, is located between the one concessioned by the Americans from BSOG and the one concessioned by OMV Petrom and Romgaz.
It should be noted that Romgaz has the right of preemption if Lukoil decides to give up the Black Sea concession.
MOL is 30.49% owned by three foundations, which are effectively controlled by the Hungarian government, according to rating agency Fitch.
MOL Romania slightly reduced its business by 2% to 9.1 billion last year, and profit increased by 50% to 243.3 million lei.
The Russian company Lukoil is private, but like any natural resource business in Russia it is de facto controlled by the government.
Last year, Lukoil Romania recorded business of 11.1 billion lei, down 17%, but profit increased by 50%, to 353.6 million lei, while the number of employees decreased by 60%, to 356 people.
