Romania must take control of Lukoil's refinery Petrotel to guarantee the full implementation of international measures, to protect the jobs of the 5,000 employees, and to ensure the stability and security of the national energy system, minister of energy Bogdan Ivan argued in a Facebook post on November 11. 

"I will not request an extension of the November 21 deadline set by the American authorities. Further, I will support the replication and unified application of the sanctions initiated by the US throughout the European Union," he stated.

He announced that the Ministry of Energy is still working, together with all the relevant authorities, to draft legislation that will ensure full compliance with the sanctions regime established by the United States, and on the other hand, the continuity of the refining activities of Petrotel Ploieşti, as well as the commercialisation of petroleum products, without endangering the national fuel market supply.

Lukoil's refinery, Petrotel, has a refining capacity of approximately 2.4 million tonnes per year. It accounts for roughly 20% of the country's refining capacity, dominated by OMV Petrom's  Petrobrazi refinery (4.5 million tonnes) and Petromidia refinery 84.8 million tonnes) operated by KazMunayGaz. 

Lukoil also operates a network of about 300 fuel stations and holds a gas field concession (Trident) in Romania's Black Sea offshore, still under exploration after 30 billion cubic meters of gas were initially spotted. Romania's Romgaz is a 12% holder in the Lukoil concession.
US sanctions against Lukoil and Rosneft take effect on November 21. From that date, any business with these companies and their subsidiaries abroad ceases.

Lukoil has been trying to sell the Petrotel Ploiești Refinery for almost ten years, but investors have not been interested. One of the reasons is that the refinery has outdated facilities and requires very large investments, an oil specialist explained to Hotnews.ro.

Ziarul Financiar speculated on the option of taking over Lukoil's assets in Romania on the grounds of a large claim the state owns against the Russian group – but the legal status of the claim remains unclear ten years after the Romanian prosecutors mentioned it.

In the summer of 2015, prosecutors from the Prosecutor's Office attached to the Ploieşti Court of Appeal discovered damage of EUR 1.76 billion, made between 2011 and 2014, this being the biggest economic scandal in Romania, built around a company controlled by a foreign investor. The case is still not settled.

iulian@romania-insider.com

(PHoto source: Facebook/Rafinaria Petrotel Lukoil)