Bulgarian Finance Minister Assures Smooth Ride for Transport Sector amid Lukoil Crisis

Business » ENERGY | July 29, 2011, Friday // 13:22
Bulgaria: Bulgarian Finance Minister Assures Smooth Ride for Transport Sector amid Lukoil Crisis Bulgarian Deputy Prime Minister and Finance Minister Simeon Djankov has said that the revoked licenses of Lukoil will not cause problems in the transport sector. Photo by BGNES

Bulgaria has a 160-day reserve of fuel but will not need to use it because several companies have redirected supplies to Bulgaria, according to Finance Minister Simeon Djankov.

His words come after a media craze and a spate of divergent political and expert reactions over the Wednesday decision of the Customs Agency to revoke the tax warehouse operator license of Lukoil for two facilities, Lukoil Neftochim and Oil Terminal Rosenetz.

The step was taken to penalize the Bulgarian branch of the Russian oil giant for failing to install the mandatory measuring devices allowing control over taxable fuel volumes released on the market.

In a Friday interview in Parliament, Djankov assured journalists that, starting July 28, additional supplies could be brought in if necessary.

The Finance Minister refused to comment whether the relocated fuel supplies would increase the cost of the commodity in Bulgaria.

He also vowed that airline companies would not encounter difficulties as there were fuel stocks for about one month in the State Reserve.

"It turned out that securing secure supplies from other countries was a matter of 2-3 days, meaning that neither car, rail or air transport will face problems", Minister Djankov declared.

He rejected allegations that the Lukoil refinery was the only option for the provision of aviation fuel, citing one Romanian and two Greek refineries as an alternative.

On Thursday, Lukoil Bulgaria CEO Valentin Zlatev claimed that the Burgas-based plant was the sole producer of Jet A-1 aviation fuel in the region.

As regards the Bulgarian State Railways BDZ, which used to rely on a long-term contract with Lukoil, it was reported to have enough fuel to last about a week amid attempts to secure supplies from alternative sources.

Djankov further said that the procedure for accessing the State Reserve was relatively simple and was managed by the Ministry of Economy, Energy and Tourism and the Interior Ministry.

The Finance Minister assured that Lukoil would not have its permits restored until it met all legal requirements.

He reminded that the company had had 15 months to comply with the new standards, which it had obviously preferred to ignore until realizing that the state and the law were above any whatsoever business entity.

Djankov also noted that 74 liquid fuel tax warehouses had installed the mandatory measuring devices, while four others had failed to and had gone out of business, two stop-work orders had been handed and the inspection of two remaining tax warehouses was yet to be concluded.

The Deputy Prime Minister, however, refrained from commenting on the steep drop in taxes paid by Lukoil for 2011.

A recent report of Krasimir Stefanov, Director of the National Revenue Agency, to the Finance Ministry indicated that VAT receipts from Lukoil had plummeted by around 60%, or BGN 123 M, compared to 2010.

We need your support so Novinite.com can keep delivering news and information about Bulgaria! Thank you!

Energy » Be a reporter: Write and send your article
Tags: Simeon Djankov, Finance Minsiter, Lukoil, Lukoil Neftochim, refinery, Customs Agency, excise duty, VAT, Valentin Zlatev, aviation, BDZ

Advertisement
Advertisement
Bulgaria news Novinite.com (Sofia News Agency - www.sofianewsagency.com) is unique with being a real time news provider in English that informs its readers about the latest Bulgarian news. The editorial staff also publishes a daily online newspaper "Sofia Morning News." Novinite.com (Sofia News Agency - www.sofianewsagency.com) and Sofia Morning News publish the latest economic, political and cultural news that take place in Bulgaria. Foreign media analysis on Bulgaria and World News in Brief are also part of the web site and the online newspaper. News Bulgaria