The Bulgarian Parliament on Friday passed legislative amendments placing the country’s largest Lukoil refinery under state control, following U.S. sanctions against the Russian oil giant.
The U.S. sanctions, announced last month, target Russia’s two biggest oil producers — the state-owned Rosneft and private Lukoil — in an effort to pressure President Vladimir Putin to negotiate an end to the war in Ukraine.
Lukoil owns the Neftohim refinery in the Black Sea city of Burgas, Bulgaria’s largest refinery and biggest company, operating there since 1999. According to the legislation, the sanctions, effective November 21, are expected to halt refinery operations, as contractual parties refuse to make payments to Lukoil-owned entities.
State-Appointed Administrator
The new law allows the government to appoint a special administrator with shareholder voting rights, who can potentially sell the refinery shares to a new owner with government approval.
The legislation was passed extremely quickly, with amendments added to the agenda and approved in just 30 seconds in the parliamentary energy committee. The plenary vote, conducted in both first and second readings, followed immediately.
Opposition lawmakers criticized the hasty adoption and expressed concerns that granting the administrator the power to sell shares could lead to legal challenges against Bulgaria.
Export Restrictions for Energy Security
Last week, Bulgaria also introduced temporary export restrictions on petroleum products, including diesel and aviation fuel, to maintain domestic supply in light of the sanctions. Exceptions apply for refueling local and foreign vessels and aircraft as well as for NATO and EU member states’ armed forces under the bloc’s Common Security and Defence Policy.
