Russia's Lukoil Contemplates Asset Sale in Bulgaria Amid Changing Conditions

Lukoil has announced a strategic review of its Bulgarian ventures due to significant alterations in conditions. The private oil corporation indicated a potential sale of its business among various options being considered, as stated in their announcement on Tuesday.

The company's decision to reassess its strategy is primarily prompted by Bulgaria's legislative changes, particularly the termination of exemptions for Lukoil Neftohim refinery from the European ban on Russian oil imports from March 2024. This also involves the imposition of additional profit taxes and the necessity to modernize the facility for non-Russian oil processing.

Highlighting its grievances, Lukoil criticized Bulgaria's authorities for discriminatory laws and biased political decisions that it claims are unrelated to fair business regulation or the nation's fiscal advancement. The company expressed concern about the negative impact of this political discourse on its business, Bulgaria's investment climate, and the nation's global reputation.

The Russian corporation initially entered Bulgaria in 1999 by acquiring the Burgas refinery "Neftohim" and claims to have invested $3.4 billion in it since then. It also expanded its presence with 220 gas stations, nine oil depots, and shipping and aviation bunkering businesses.

According to Lukoil's estimations, approximately €500 million would be necessary to enable "Lukoil Neftohim" to process lighter, non-Russian oil varieties.