Page 16 - EurOil Week 02 2023

EurOil PROJECTS & COMPANIES EurOil

Russia’s Lukoil sells its Italian ISAB refinery

ITALY LEADING Russian privately owned oil major from US company ExxonMobil.
Lukoil has sold its Italian refinery to a group of The ISAB plant in Italy directly employs
A Trafigura-backed firms led by Cypriot private equity firm G.O.I. around 1,000 people and is located in an eco-
company has bought Energy and backed by Swiss-based trading nomically depressed region in southern Italy.
the asset. house, Trafigura, it was reported on January 10. The deal is set to close in March and is worth an
This marks the company's first significant estimated €1.5bn, Euractiv reports. However, the
asset sale since Russia's invasion of Ukraine last deal is subject to approval from the Italian gov-
year and the imposition of sanctions by Western ernment under its "golden power" regulations,
countries. which reserve the right to block or impose con-
In the past, Lukoil had been an active buyer ditions on deals involving strategically impor-
of Western assets, but these overseas holdings tant companies. The government has stated that
became problematic following the imposition of it will demand commitments to converting the
sanctions. However, the sale of the ISAB plant plant to green energy and industrial revitaliza-
in Sicily, which refines 320,000 barrels per day tion, as well as guarantees on jobs.
(bpd) of crude oil and accounts for a fifth of Ita- Trafigura will not be taking a stake in the
ly's refining capacity, represents a partial success plant, but will be providing some financing and
in a climate of asset confiscations by both Russia handling crude oil supplies and refined product
and the West. output. This marks an expansion for the trading
In contrast Germany has confiscated state- house into the refining sector and follows a sim-
owned oil major Rosneft’s stake in the German ilar deal with Prax in 2021 for a refinery in the
refinery Schwedt and state-owned gas behe- UK. Trafigura already holds a 3% stake in Italian
moth Gazprom’s German subsidiary, Gazprom refiner, Saras, an indirect stake in India's Nayara
Germania’s assets. For its part Russia has forcibly refinery, and runs two small refineries via sub-
taken over of the Sakhalin-1 oil and gas complex sidiary Puma Energy. ™

Poland stands by windfall profit taxation of

energy companies, Morawiecki says

POLAND POLAND will not walk back regulations taxing government will enter a legal dispute over the
windfall profit of energy companies, Prime Min- issue to prevent energy prices from rising, which
Warsaw is sticking ister Mateusz Morawiecki said on January 10. would have come at a “gigantic societal cost”.
with its plan to tax the The PM thus reacted to the announcement EDPR said that the Polish and Romanian
excess profits of energy by the Portuguese renewable energy firm EDPR regulations in question ignored the EU’s inten-
companies. Renovaveis, which said on January 9 that it tion of taxing energy companies’ excess profits,
would take legal action against Poland and excluding companies that do not “benefit from
Romania over recently introduced legislation the currently high electricity prices due to having
taxing excess profit that energy companies made hedged their revenues against fluctuations in the
thanks to energy prices skyrocketing in the wake wholesale electricity market”.
of Russia’s war in Ukraine. The Polish and Romanian legislation does
“The whole of Europe encourages taxation of not follow the “principle of clawing back only
excess profits [of energy companies]. We are also realised market revenues as both ignore finan-
introducing these mechanisms,” Morawiecki cial hedges in place within EDPR”, the com-
told a press briefing. pany said.
The PM added that once renewable energy In effect, “these new taxes may result in …
installations are up and running, “the marginal taxation of unrealised profits”, EDPR said.
costs of generating energy are very low. If energy Poland and Romania introduced new taxes to
prices on the stock exchange are very high, inves- help fund relief to consumers facing exorbitant
tor benefits are gigantic.” energy prices. Several other EU countries have
Morawiecki also said that the Polish similar legislation in place. ™

P16 www. NEWSBASE .com Week 02 12•January•2022