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KazMunayGas, the state-owned oil company of Kazakhstan, is reportedly taking part in a tender to acquire the Bulgarian-based refinery of Russian oil giant Lukoil, known as Lukoil Neftokhim Burgas. According to Bloomberg and 24 Chasa, which cite two sources familiar with the negotiations, KazMunayGas has submitted an offer in the ongoing sale process.
If successful, KazMunayGas intends to supply Kazakh oil to the refinery under the most favorable terms, claiming its oil would be a suitable replacement for Russian crude. Litasco SA, a major shareholder in Lukoil Neftokhim Burgas, and its affiliate have already received binding offers from various potential buyers, including the Kazakh firm. KazMunayGas is reportedly discussing the financing for the deal with Vitol Group, a leading global oil trader, particularly involved in the Kazakh market.
The sale process is expected to take around a month, with the transaction potentially reaching a price of billion. However, as part of the conditions for the deal, the money from the sale must not end up in Russia, even though Litasco itself is not under sanctions. Neither KazMunayGas, Lukoil, nor Bulgaria’s Ministry of Energy responded to requests for comment on the matter. A Vitol spokesperson also declined to comment.
Kazakhstan’s oil share in Bulgaria has significantly increased since 2023, following Bulgaria’s decision to ban Russian oil imports as part of the European sanctions after Russia's invasion of Ukraine. As a result, Kazakh crude now accounts for approximately 40% of the oil processed at the Lukoil refinery, with the remainder coming from the Middle East.
Lukoil, Russia’s second-largest oil company, has been seeking to divest its stake in the refinery and related fuel sales business in Bulgaria, citing unfavorable political conditions and what it described as discriminatory laws. Hungarian company Mol Nyrt. is also reportedly vying for the Bulgarian plant, though the company declined to comment on its involvement.
KazMunayGas is advocating for the Bulgarian government’s support in its bid, emphasizing that the refinery is well-suited for processing Kazakh oil due to its similarity to Russian crude. The Kazakh firm argues that its supply offers the most stable option for the refinery, a claim they assert other potential buyers cannot match.
The Bulgarian government has stated that while it is closely monitoring the situation, it cannot be directly involved in the ownership change due to the presence of a private majority stakeholder. Energy Minister Vladimir Malinov reiterated this position on December 23.
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