Russian oil giant Lukoil has announced plans to sell its majority stake in the Lukoil Neftochim Burgas refinery in Bulgaria by the end of the year. The sale is set to be finalized with a Qatari-British consortium, which includes Oryx Global and the London-based commodity trading house DL Hudson.
Lukoil confirmed the deal in a letter to Russian President Vladimir Putin, stating that the transaction will require his approval. The financial terms of the sale have not been disclosed.
The Bulgarian refinery, located near the coastal city of Burgas, attracted interest from several potential buyers, with at least six entities reportedly expressing interest in acquiring the asset. Alongside the Qatari-British consortium, the final bidders included Azerbaijan’s State Oil Company (SOCAR), Kazakhstan’s KazMunayGas, and Turkish oil company Opet.
The move comes as Lukoil faces significant operational challenges following the European Union’s ban on Russian oil imports, which was enacted in response to Russia’s invasion of Ukraine. This EU sanction has made it increasingly difficult for Lukoil to continue its operations in Bulgaria.
In December 2023, Lukoil revealed it was exploring various options for its Bulgarian operations, including a potential sale of its assets. Besides the Burgas refinery, Lukoil’s Bulgarian portfolio includes 220 petrol stations, nine oil storage facilities, and marine and aviation bunker operations.
Further complicating matters, the Bulgarian Parliament passed amendments to the country’s legislation in late 2023, effectively halting crude oil imports from Russia starting in March 2024. This decision coincides with the expiration of the EU exemption at the end of 2024 and a new ban on the export of Russian crude-based fuels that will take effect from January 2024.
