'Lukoil' Set to Sell Its Foreign Assets to Gunvor, Burgas Refinery Is Part of the Deal

Russian oil giant Lukoil is set to sell its foreign assets to the Cyprus-registered energy company Gunvor. Lukoil announced that it has accepted an offer for the purchase of 100% of its international holdings, a decision following U.S. sanctions coming into effect on 21 November. Confirmation of the deal has also come from the prospective buyer. These assets include the subsidiary Litasco, which owns the refinery in Bulgaria.

The upcoming deal is the largest sale of Russian assets in the wake of Western sanctions. Lukoil's website states that "the key terms of the transaction have been agreed in advance" by both parties. It also states that the company accepts the offer and commits not to negotiate with other potential buyers.

What are Lukoil's international assets?

The assets include the Burgas refinery in Bulgaria, Petrotel Lukoil in Romania, and a 45% stake in the Zeeland refinery in the Netherlands. Lukoil also holds stakes in oil fields in Azerbaijan, Kazakhstan, and Uzbekistan, as well as assets in the Middle East, including Iraq and Abu Dhabi. Additional holdings exist in Mexico and across Africa, in Ghana, Congo, Egypt, Cameroon, and Nigeria. Gunvor, founded at the turn of the century, has historically been one of the largest traders of Russian gas and oil.

About Gunvor

The company, registered in Cyprus and established in 2000 with headquarters in Switzerland, was co-founded by Swedish entrepreneur Torbjörn Törnqvist and Russian billionaire Gennady Timchenko, a close associate of Russian President Vladimir Putin. Timchenko runs Volga Group, a private investment firm focused on energy, transport, and infrastructure, and was placed on the U.S. sanctions list following Russia’s annexation of Crimea in 2014. Törnqvist became the majority owner of Gunvor following those sanctions.

The completion of the transaction will require approval from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC).