Azerbaijan’s state oil company SOCAR is interested in further expanding its “downstream” activities. The “downstream” sector includes activities related to processing, including oil refining and petrochemicals, distribution and trading of petroleum products or petroleum derivatives.
Specifically, Eurasianet on January 8 quoted the Azerbaijani Ambassador to Bulgaria as saying that SOCAR is interested in acquiring the Neftohim oil refinery near the Bulgarian port of Burgas on the Black Sea. This is the largest oil refinery in Southeast Europe, owned by the Russian energy giant Lukoil since 1999.
Last December, Lukoil announced that it was considering selling its 9.5 million tonnes/year refinery and other assets in Bulgaria.
“Given the significant change in the operating conditions of Lukoil Group companies in Bulgaria, the company has begun to review its strategy for this asset. Various options will be analyzed... including the sale of the business” in consultation with international experts, Lukoil said in a statement on its website.
With 220 gas stations and nine oil depots in Bulgaria, Russia's Lukoil now dominates fuel production, storage and distribution in the Southeast European country. Photo: Sofia Globe
The announcement comes in response to Bulgarian lawmakers formally agreeing to end the country’s exemption from EU sanctions on Russian oil earlier than scheduled, meaning Russian oil will be banned from Bulgaria more quickly, starting March 1 instead of the previous deadline of October 31 this year.
Lukoil’s Bulgarian network also includes a chain of 220 gas stations, nine oil storage facilities and businesses supplying marine and aviation fuel. The Russian energy giant accused Sofia authorities of applying “discriminatory laws and other unfair and biased political decisions against the refinery.”
Azer News late last year cited local media sources as saying that several organizations were interested in buying Lukoil's Bulgarian operations, including two US investment funds and two small oil companies, but only Azerbaijan's SOCAR was the most serious.
SOCAR opened a representative office in the Bulgarian capital Sofia last April and is currently only involved in the natural gas business. If it buys the Lukoil refinery, SOCAR would be able to supply it with crude oil from Azerbaijan, which is exported to the Black Sea region via the Baku-Novorossiysk pipeline.
Azerbaijan is an OPEC+ member state with rich natural resources and a long history of oil and gas production. The Caspian country was also the first to experience the first oil boom of the 20th century .
Minh Duc (According to Eurasianet, Azer News)
Source
Comment (0)