Ukraine to sell majority share in major oil refinery to Russia

Jun 16, 1999 02:00 AM

Ukraine will sell neighbouring Russia a controlling stake in one of its largest oil refineries, a Russian official said recently.
The deal was announced by the visiting Russian fuel and energy minister, Viktor Kalyuzhny, who said the agreement would likely boost oil refining in Ukraine.
The Ukrainian government currently owns 67.41 % of shares in the LiNOS, or Lisichansknefteorgsintez plant, with the rest belonging to various investors.
Ukraine does not have enough money and oil to keep such plants afloat, while Russian ownership would guarantee a steady oil supply and provide some much-needed revenue for the Ukrainian budget.

Government tenders for the purchase of 40 % of shares were called off twice last year due to the lack of investors, according to the Interfax news agency.
Kalyuzhny, whose comments were carried by Interfax, gave no additional details about the planned deal after meeting with Ukrainian Prime Minister Valery Pustovoitenko.
He said the talks also touched on the issue of increasing Russian oil supplies to Ukraine. The volume of supplies should amount to 8 to 9 mm tpy, but Ukraine should first reduce its oil transit tariffs "by at least 40 %," Kalyuzhny noted.

Source: AP via Newspage
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