EU state’s sole refinery at risk of shutdown – Lukoil

Russian energy major Lukoil has warned that Bulgaria’s decision to terminate its exemption from an EU embargo on Russian oil ahead of schedule will jeopardise operations at the country’s sole refinery, and poses risks to the nation’s fuel market.

Neftochim Burgas, Bulgaria’s largest refinery, is majority-owned and operated by Lukoil, a Russian private oil and gas corporation. The likely halt in production at the facility carries logistical risks that could cause a fuel supply crisis in the Balkan state.

“Cancelling quotas for exports of petroleum products that are not used on the Bulgarian market from January 1, 2024 is equivalent to termination of permission to use Russian oil starting December 2023,” Lukoil said, as cited by Bulgarian media.

According to the company, the inability to export petroleum products will quickly lead the plant's storage overflowing, meaning production will have to be shut down.

“This situation may place the enterprise in conditions of increased technological and logistical risk and pose a threat to fuel supplies to the Bulgarian market,” Lukoil concluded.

The Lukoil Neftochim Burgas management has called on the Bulgarian authorities to engage in urgent dialogue, to find a comprehensive solution.

On November 17, members of the parliamentary majority in Sofia agreed on new restrictions regarding the Lukoil Neftochim Burgas plant. Under the decision, the enterprise will be prohibited from using Russian oil for processing starting on March 2, 2023, and will no longer receive quotas for fuel exports as of January.

A corresponding bill is expected to be adopted the parliament by the end of this month.

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