Chinese Seal Major Romanian Energy Acquisition

Romania on Thursday approved China Energy Company Limited's purchase of a majority stake in KMG International, by which it will obtain control of the Romanian energy company Rompetrol Rafinare.

Kazahstan-based KMG International owns 48.1 per cent of Rompetrol Rafinare, with the Romanian state owning another 44.7 per cent. Other share holders hold the rest.

Rompetrol owns Romania's biggest oil refinery and its second-biggest fuel distribution network.

"Completion of the transaction will create a solid foundation for … further expanding our activities in Eastern and Western Europe. The joint venture will be able to take advantage of the energy potential of Kazakhstan and China's financial resources to expand its activities throughout the area of the global project, 'One Belt - One Way', Zhanat Tussupbekov, KMG International CEO, said in a press statement.

"Particular attention will be paid to projects in Romania - as the country where the main assets of the KMGI Group are located," he added.

Last year, China Energy Company, CEFC, announced it wished to buy 51 per cent of KMG International for 680 million US dollars as part of China's ambitious "One Belt - One Way" project. 

Proposed in 2013 to promote expanding links between Asia, Europe and Africa, the project is due to pour billions of dollars into infrastructure investment. Broad on ambition, it is still short on specifics, however.

Analysts say it could be in Romania's economic interest to be part of China's push into Central and Eastern Europe.

"Romania is hoping to become a regional energy hub and any Chinese investment could help this. Unfortunately ... Bucharest failed so far to be a trustworthy political and commercial partner for China," journalist Sabina...