The Future of Lukoil: Bulgarian Government with Measures for the Fate of the Refinery in Burgas

The Bulgarian government moved quickly on Friday to propose urgent amendments expanding the authority of the special administrator overseeing the Lukoil refinery in Burgas. The draft legislation, submitted by the parliamentary majority, immediately triggered tension with the opposition, which accused the ruling parties of acting behind closed doors and bypassing the relevant parliamentary committee.

The move comes after Gunvor withdrew from its deal to acquire Lukoil’s overseas assets, a development that has caused political turbulence in Sofia. Before the start of the parliamentary sitting, the We Continue the Change–Democratic Bulgaria (WCC–DB) group demanded the immediate hearing of Prime Minister Rosen Zhelyazkov and key ministers responsible for the refinery and its subsidiaries. The motion was rejected by the majority.

Instead, at 9:10 a.m., just ten minutes after the start of the sitting, an extraordinary meeting of the Energy Committee was convened. The sole agenda item: legislative changes granting the special administrator full control over the refinery and its subsidiaries, effectively prohibiting shareholders, board members and executive directors from conducting any business transactions or operational activities on behalf of the company.

According to GERB leader Boyko Borissov, the new powers would also enable the special administrator to sell the refinery and its subsidiaries with approval from the Council of Ministers and the State Agency for National Security (SANS). Proceeds from any such sale would be placed in a special “Russian account” and remain frozen until sanctions against Russia are lifted.

The opposition criticised the ruling parties for what it described as panic-driven, opaque decision-making. Members of WCC–DB said they had not been present at the energy committee meeting and had no prior access to the proposed amendments.

Ivaylo Mirchev (WCC–DB):
“The situation is becoming extremely dangerous for the country, and I am astonished at the calmness with which Parliament is treating it. Two weeks after the sanctions were imposed, no member of the government has come to the National Assembly to explain the state’s plan for dealing with the fuel crisis. That’s why we’ve just submitted an urgent request for a closed hearing with the Prime Minister, the Minister of Economy and the Minister of Energy.”

Boyko Borissov (GERB):
“We are taking full control — a German-style model. Once the governing parties agree, we’ll appoint someone fully capable of handling this task. The administrator will also have the right to sell. Our aim is to complete everything by 21 November. The proceeds will go into a special account belonging to the Russian company, but they won’t be accessible — just as in Germany and Belgium.”

Radoslav Ribarski (Continue the Change – Democratic Bulgaria):
“An emergency meeting of the Energy Committee was convened for 9:10 a.m., but it was held without waiting for representatives from all parties to arrive. Quite literally, the majority called the meeting, gathered ahead of the scheduled time, and approved a bill expanding the powers of the special administrator. Instead of hearing from the Prime Minister and the relevant deputy prime ministers, we are now dealing with the government’s panic-driven actions regarding Lukoil.”

Delyan Peevski – Chair of the Movement for Rights and Freedoms (MRF):
“I can see the hysteria coming from the party of the poodles (allegedly referring to the opposition We Continue the Change party) and the party of Lukoil. This should have been resolved two years ago, but back then a certain ‘Niki-Miki’ (allegedly referring to Nikolai Denkov from WCC-DB) —who, unfortunately for Bulgaria, was prime minister at the time—said he would resign and pull out of the coalition if it happened. That’s why now we have to act very quickly. There are no problems whatsoever — fuel reserves are sufficient, exports have been stopped, and people will have fuel. The only hysteria is in Lukoil’s party. They need to understand — there will be no more cash handouts. I also hope that once the special administrator enters Neftochim, it will become clear who was being paid and who was visiting that company’s offices.”

Kostadin Kostadinov (Vazrazhdane):
“If the Bulgarian state, through Peevski and Borissov, seizes this asset, it will face serious consequences. Russian authorities could confiscate Bulgarian assets in Russia, and we’ll face international lawsuits, including from ING, which owns Lukoil.”

Radostin Vasilev (MECH party):
“This is a nationalisation — a forced state takeover of the private company Lukoil through the appointment of a so-called special representative.”

photos by BTA

The amendments passed at first reading, but the government signalled its intent to shorten the interval between readings to ensure swift adoption of the bill.