Bulgaria considers SOCAR as one of the potential buyers for the Burgas refinery, but the Azerbaijani side is concerned about the complex logistics involved.
The suspension of supplies of Russian oil to the Lukoil refinery in Burgas from March 2024 does not mean the company's losing the opportunity to supply this refinery with raw materials, a source familiar with the matter told Trend.
“The refinery still belongs to Lukoil, and its trading structure Litasco has simply stopped supplying oil of Russian origin to this plant since March but supplies oil from other countries, in particular Iraq, Tunisia, and Kazakhstan. No one except Litasco “It does not have the right to supply this refinery with oil,” the source noted.
Back in December 2023, the Bulgarian Parliament unanimously approved laws restricting the export of gasoline derived from Russian oil beginning January 1, 2024. Furthermore, the law stipulated that the processing of Russian-origin oil at the Lukoil refinery (the only large refinery in Bulgaria) in Burgas would end on March 1, 2024.
Besides, in December of last year, Lukoil announced plans to reconsider its business in Bulgaria "due to political decisions by the Bulgarian leadership."
"Lukoil has been investing in Bulgaria for over 20 years, with its investments in the refinery in Burgas exceeding $3.4 billion, making it the largest enterprise in the region. The company has established 220 gas stations and nine oil depots in the country. Our potential strategy review is related to political decisions," noted the company's statement.
The oil processing capacity of the Burgas refinery exceeds eight-nine million tons per year, producing a full range of petroleum products and serving as the main fuel supplier for the Bulgarian market.
"Bulgaria is seeking buyers for the Burgas refinery on the Black Sea, but there are no clear conditions. Currently, no company can guarantee uninterrupted oil supply to this plant and is not ready to purchase it," emphasized the source.
Regarding the prospects of supplying oil to the Burgas refinery from SOCAR Trading, an affiliate of the State Oil Company of Azerbaijan (SOCAR), the source mentioned that although SOCAR has been operating in Bulgaria for almost a year, it holds a 10-year license only for gas trading, not oil.
"Litasco holds the monopoly right for the Burgas refinery. As for SOCAR Trading, it can sell gas to consumers in Bulgaria from various sources, including Azerbaijan," explained the source.
Bulgaria considers SOCAR as one of the potential buyers for the Burgas refinery, but the Azerbaijani side is concerned about the complex logistics involved.