The Bulgarian state will continue to exercise operational control over Lukoil Bulgaria through the institution of the special commercial administrator, while at the same time ensuring full compliance with the sanctions regimes imposed by the European Union, the United States and the United Kingdom. This was announced by Minister of Economy, Investment and Industry Alexander Pulev on July 29.
According to Pulev, the government has taken the necessary steps to prevent operational control of the company from reverting to its Russian owners and managers following the Constitutional Court's ruling.
"That would mean sanctions, the closure of the refinery, disruption to the fuel market, and serious consequences for Bulgarian consumers," Pulev said.
He announced that, during a closed session, the Council of Ministers had taken steps to designate two companies from the Lukoil group – Lukoil Aviation Bulgaria EOOD and Lukoil Bulgaria Bunker EOOD – as entities related to the national security of the Republic of Bulgaria.
"The government respects private property. The government respects private interests. But the government is guided solely and primarily by the interests of the Bulgarian people, Bulgarian households and consumers," the minister said.
Pulev described the amendments to the Lukoil legislation adopted during the Borisov government as "30 seconds of aggression". According to him, they created the risk of arbitration disputes involving potential damages of BGN 3 billion, as well as problems related to the freezing of accounts and the diversification of fuel supplies.
"Thirty seconds of anger outburst in the Economic Policy Committee created an entire cascade of problems that threatened the interests of Bulgarian consumers, Bulgarian citizens and the country's economic processes. Thirty seconds – potential damages of BGN 3 billion as a result of arbitration disputes. Thirty seconds of aggression – the freezing of Lukoil Bulgaria's accounts and the restriction of Bulgarian companies' ability to diversify fuel supplies from non-sanctioned oil suppliers registered in Switzerland. Thirty-second amendments that were subsequently declared unconstitutional by the Constitutional Court," Pulev said.
The minister also stated that the government had taken steps to extend the derogation from the sanctions regimes. An official request to extend the relevant licence was submitted to the UK authorities last week, with the current authorisation due to expire on 13 August. Further action will also be taken with the US authorities, where the corresponding deadline falls in October.
"We have taken every necessary measure. At all times, through the institution of the special commercial administrator, the Bulgarian government has ensured compliance with the sanctions regimes. We have not been in breach for a single day or even a single hour. Not a single molecule of Russian oil has been processed at Lukoil Bulgaria, and the refinery has been operating exclusively with crude oil supplied by non-sanctioned suppliers," Pulev said.
According to him, the Bulgarian government remains in constant contact with the US Office of Foreign Assets Control (OFAC) and the UK's Office of Financial Sanctions Implementation (OFSI), as well as with representatives of both governments.
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