Page 14 - Euroil Week 19 2020

EurOil POLICY EurOil
Bulgaria aims to boost tax control over Lukoil-owned fuel supplier
POLICY
BULGARIA’S parliament on May 8 backed increased tax controls over the country’s biggest fuel supplier, owned by Russia’s Lukoil. The move is aimed at boosting budget revenues, which have shrunk amid the state of emergency declared in response to the coronavirus (COVID-19) pandemic.
Under the changes, due to receive final approval this week, Lukoil Bulgaria will have one month to apply to register its six fuel depots and a 400-km fuel pipeline running from its Nefto- chim Burgas oil refinery as separate tax entities. At present all these assets are considered by the customs office as a single fuel depot.
Finance Minister Vladislav Goranov said the changes would improve transparency and ensure the proper collection of excise duties from fuel sales.
Lukoil Bulgaria, which also operates more than 220 filling stations in the country, has warned it may suspend operations if lawmakers bring the new proposals into force.
“Given the deadlines, the amount of work required and the practical impossibility of
meeting them, the danger of stopping work is real,” Lukoil Bulgaria’s director-general Bulat Sub- aev told public radio station BNR on May 8. “Rev- enues in the budget do not depend on how many tax warehouses our infrastructure will be divided into – nothing will be added to the Treasury from the division itself. And secondly – this will entail huge investments and administrative costs.”
The Bulgarian Petroleum and Gas Associa- tion also opposes the changes, noting that they were not discussed with representatives of the sector and would require significant investments for companies to comply with them. This is at a time when fuel suppliers are already struggling because of the loss of sales as a result of COVID- 19 travel restrictions.
“Not all warehouses will be able to implement the projects on time. Some of the warehouses may close, filling stations will be supplied from a more distant location. Tolls and transport costs will increase, and this will likely be reflected in the fuel prices,” the association’s president, Zhi- vodar Terziev, told BNR.™
PROJECTS & COMPANIES
Petrofac bags new North Sea deals
UK
The contracts are with BP and another unidentified oil company.
UK energy services firm Petrofac has scored North Sea contract renewals valued at more than $100mn, safeguarding almost 200 jobs, while also securing additional extensions with BP.
The two three-year contract renewals were won by Petrofac’s engineering and production services (EPS) division during a competitive tender. Petrofac did not name the client.
They comprise duty holder support services for an offshore support vessel, and operations and maintenance services for an oil and gas develop- ment project and gas terminal, the London-head- quartered firm said. They cover 195 jobs.
“These new contracts with a long-standing client are an excellent example of our ability to scale and integrate our service provision in line with their latest requirements,” Petrofac’s managing director for EPS, Nick Shorten, said. “We very much look forward to combining our extensive operations’ experience and digital technology programme to deliver sustainably efficient support on these contracts.”
Petrofac later said on May 12 it had also been awarded a three-year extension to its
maintenance contract with BP, along with a new four-year metering contract. The metering ser- vices contract comprises onshore and offshore consulting and support services, it said. Under the agreement, Petrofac will continue to harness digital technology to drive improvements and increase efficiencies for BP.
Under the maintenance deal, Petrofac will continue to provide campaign inspection and maintenance services on BP’s North Sea assets, many of which Petrofac has supported for the last decade.
Petrofac suffered a major blow last month when the UAE’s ADNOC cancelled awards val- ued at $1.65bn for services at the Dalma sour gas project. Petrofac had secured the contracts through its joint venture with Malaysia’s Sapu- raKencana, and its share was $1.5bn.
The cancellations undermined Petrofac’s strong performance in securing new business in the first quarter. In light of the coronavirus (COVID-19) pandemic and bleak outlook for oil markets, Petrofac’s new orders are likely to be few and far between moving forward.™
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w w w . N E W S B A S E . c o m Week 19 14•May•2020