SOUTH EAST EUROPE: Kazakhs from Rompetrol are negotiating the purchase of the Lukoil refinery in Bulgaria, a transaction valued at one billion dollars – sources
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Kazakhstan’s state oil company KazMunayGas, which controls Rompetrol Group, has submitted a bid to buy Bulgaria’s Lukoil refinery, according to two people familiar with the negotiations, cited by Bloomberg.
Litasco SA, the main shareholder of Lukoil Neftohim Burgas AD – the company that runs Bulgaria’s only Burgas refinery – and its subsidiary have already accepted firm offers from several potential buyers, including KazMunayGas, the sources said, speaking on condition of anonymity because the discussions are private.
The Kazakh company is discussing financing for the potential acquisition with Vitol Group, the world’s largest independent oil trader and a major player in Kazakhstan.
KazMunayGas expects the sale process to take about a month, one of the people said. The price could be around $1 billion, and even though Litasco is not a company subject to Western sanctions, a condition of the sale is a guarantee that the money will not be transferred to Russia, the source said.
KazMunayGas, Lukoil and the Bulgarian Energy Ministry did not respond to requests for comment. A Vitol spokesman declined to comment.
The Kazakh company controls the Rompetrol group, which operates two refineries in Romania, Petromidia (the country’s largest) and Vega, and a fuel distribution network in Romania, Bulgaria, Georgia and the Republic of Moldova.
The sale of Lukoil’s Bulgarian business, a deal that is constantly being talked about
On Christmas Eve, it was reported that the Hungarian oil and gas company MOL had officially expressed its interest in acquiring the Lukoil refinery in Burgas. The interest of Hungarian company MOL was confirmed at the time by Hungarian Prime Minister Viktor Orban, who said during a briefing in Budapest that MOL had submitted a bid for the Burgas refinery and was among seven potential buyers. Orban’s statements followed his visit to Bulgaria, where he met with President Rumen Radev and GERB leader Boyko Borissov.
Hungarian media reported that Lukoil intended to sell the refinery through an open tender, with MOL the only bidder based in the European Union. Bulgarian television BNT quoted Orban’s comments, stressing that MOL’s involvement could raise concerns due to its ties to the Hungarian government, known for its keen interest in Balkan affairs.
In early November, the Financial Times reported that Russian energy group Lukoil plans to sell its Bulgarian refinery – its largest asset in the Balkans – to a Qatari-British consortium by the end of the year, in a sign of Moscow’s weakening influence over energy supplies in southeastern Europe. Lukoil has chosen a consortium of Oryx Global, controlled by Qatari businessman Ghanim Bin Saad Al Saad, and London-based commodities trading house DL Hudson as its preferred buyer, and has said it wants to close the deal before the end of the year.
Oryx declined to comment and DL Hudson did not respond to requests for comment. Lukoil later denied the report.
According to the FT, the final list of companies with which Lukoil would discuss the sale includes Socar, the state-owned energy company of Azerbaijan, KazMunayGas, the state-owned energy group of Kazakhstan, and Turkish oil group Opet. Socar, KazMunayGas and Opet did not respond to requests for comment at the time.
On the other hand, according to Bulgarian media, a representative of one of the interested companies, who preferred anonymity, revealed that the potential sale could include all of Lukoil’s assets in Bulgaria, not just the Burgas refinery. This would include the distribution network and the sales department. Despite speculation, there is currently no firm offer and the sale is not at an advanced stage, according to this source. Experts quoted by Bulgarian media estimate that all of Lukoil’s assets in Bulgaria could be valued at around 5 billion leva (2.5 billion euros), but Lukoil has never disclosed a price
We recall that Lukoil is also present in Romania, with the third largest refinery in the country, Petrotel Ploiești, and a network of over 300 fuel stations.
