Bulgaria is urgently working to prevent the closure of its only oil refinery before U.S. sanctions on the Russian owner come into force later this month.
The parliament in Sofia approved legal changes granting additional state authority to a government-appointed manager of the Lukoil-owned Burgas refinery on the Black Sea coast.
The decision followed a leading international commodities trader withdrawing plans to buy Lukoil’s international assets, as the company denied U.S. government accusations of being “the Kremlin’s puppet.”
Lukoil announced it was selling its international assets in response to U.S. sanctions intended to pressure Russia into agreeing to a ceasefire in its conflict with Ukraine. The company holds interests in oil and gas projects in 11 countries, including the Burgas refinery, as well as gas stations in numerous countries.
The new amendments grant the manager significant operational control over the refinery, including the authority to sell its shares. Opposition lawmakers criticized the amendments, suggesting they could lead to legal action against Bulgaria.
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“This person will be granted such extraordinary powers that, ultimately, Lukoil will sue Bulgaria—and the money will end up in Russia,” said Ivaylo Mirchev, leader of the Democratic Bulgaria alliance.
The ruling coalition proposed the changes, arguing that the U.S. sanctions, scheduled to take effect on Nov. 21, “will effectively lead to the shutdown of the refinery’s operations due to all counterparties refusing to make payments to Lukoil-owned companies.”
In 1999, the Russian oil giant Lukoil acquired the Neftochim plant on the Black Sea. It is the largest oil refinery in the Balkans. Recent expert estimates value the refinery at 1.3 billion euros ($1.5 billion).
The Lukoil-Neftochim refinery is Bulgaria’s largest company, significantly impacting the country’s economy. In 2024, it had a turnover of about 4.7 billion euros ($5.4 billion). Its nationwide network of oil depots and gas stations, as well as its supply to ships and aircraft, gives it near-monopoly status.
Last week, Bulgaria imposed temporary restrictions on the export of petroleum products, including those intended for other European Union members, to ensure adequate domestic supplies before new U.S. sanctions on Russian energy are implemented. The ban includes exports of petroleum products, such as diesel and aviation fuel.
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