Lukoil closes sale of ISAB refinery in Italy
MOSCOW. May 4 (Interfax) - Litasco S.A. a wholly owned subsidiary of the Lukoil group, has closed the sale of the ISAB S.r.l. oil refinery in Italy to G.O.I. Energy S.r.l.
Lukoil said in a statement that the sale was completed after fulfillment by G.O.I. Energy of certain conditions precedent, including receipt of necessary approvals from the Italian authorities.
The ISAB refinery complex in southeastern Sicily is the third largest in Europe. The complex includes two oil refineries connected by a system of pipelines and integrated into a single technological complex with a total capacity of 16 million tonnes per year, as well as a tank farm with a volume of 3.7 million cubic meters and three sea berths. Lukoil became the sole owner of the ISAB complex in 2013.
Rome did not nationalize the refinery after Russia started special military operation in Ukraine, but gave itself veto power over any deal to sell the plant that could jeopardize operations or jobs. The European embargo on offshore imports of Russian oil, which came into force on December 5, complicated the situation with the provision of crude to the ISAB refinery, which was dependent on offshore supplies from Lukoil. On the eve of the oil embargo, Litasco stated that it was ready to ensure uninterrupted operation of the enterprise, taking into account the crude accumulated in the coming months and future supplies of non-Russian oil. During the year, Lukoil was in negotiations with an American investment company to sell the refinery. The plant, which is estimated to be worth 1.5 billion euros, was also of interest to American Crossbridge Energy Partners.
Litasco reached an agreement with G.O.I. Energy Limited on the sale of the ISAB refinery in January. The transaction was supposed to close by the end of March 2023 after the fulfillment of suspensive conditions, such as receiving approvals from regulators, including the Italian government. To ensure the efficient operation of the complex following the acquisition, G.O.I. Energy formed a partnership with Trafigura, one of the world's largest oil and petroleum products traders, which would ensure the continuous supply of raw materials to the refinery, as well as the shipment of the refinery's products and the necessary level of working capital.
The deal was supposed to have closed by the end of March 2023 after the fulfillment of conditions precedent, including obtaining the necessary approvals from regulators, among them the Italian government. But the Italian government needed additional time to review the deal, as the United States had privately expressed concerns about the prospective buyer, the Financial Times said. The paper quoted informed sources as saying the United States had asked Rome to confirm that Russia was not involved with G.O.I. energy. The company denied any Russian participation in its financing or operations, and maintains that the composition of the investors is "exclusively Greek, Israeli and Cypriot." Chairman of G.O.I. Energy Christodoulos Damianou is the Consul of Ukraine in Cyprus.
G.O.I. Energy is the energy arm of the Argus New Energy Fund with expertise across all asset classes. G.O.I. Energy is a partnership of leading experts with rich experience in refining, oil trading and refining financial restructuring. Investors G.O.I. Energy has a controlling interest in the Bazan Group, one of Israel's largest energy companies, which owns the country's largest oil refinery complex. CEO of G.O.I. Energy is Michael Bobrov, who previously headed Trafigura in Israel.