Hungary's MOL eyes Bulgaria's largest refinery amidst EU ban
The Hungarian oil company MOL has submitted an offer to purchase the largest refinery in Bulgaria, situated near the port of Burgas. The Neftohim Burgas refinery, owned by Russia's Lukoil, is pivotal in the Balkan fuel market. MOL is among seven bidders and is the only one representing the EU.
The Neftohim Burgas refinery is the largest industrial plant in Bulgaria and the largest in the Balkans. It is controlled by Lukoil, which holds 99 percent of the shares. However, a legal blockade on importing and processing Russian oil in Bulgaria has resulted in operational difficulties for the company.
Beginning in 2024, Bulgaria has become the first EU country to introduce a ban on importing Russian crude, significantly restricting Lukoil's operations in the region. The refinery processes oil from Kazakhstan (CPC Blend) and Norway.
Hungary's Prime Minister, Viktor Orban, confirmed at a press conference that MOL is participating in the tender to purchase the refinery. If the Hungarian group becomes the new owner, it will have to comply with Bulgarian regulations prohibiting Russian oil processing. Currently, MOL uses Russian crude, which may pose a challenge under the new operational rules at the Burgas refinery.
The buyer must commit to the ban on importing oil from Russia
The refinery in Burgas is a key supplier of fuel and petroleum products in Bulgaria. Its future owner will need approval from the Bulgarian government to conduct business and commit to the ban on importing and processing Russian oil.
Six other companies have expressed interest in acquiring the refinery, in addition to MOL. If MOL successfully completes the transaction, entering the Balkan market could represent a significant step in the company's international expansion.
