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Monday, February 21, 2005

Russian Oil Major Lukoil to Continue European Expansion

21.02.2005 10:28 MSK MosNews - Russia's largest private oil company Lukoil plans to acquire at least two oil refineries in Europe, Russian business daily Vedomosti reported on Monday, Feb. 21. The paper quoted Lukoil's vice president Leonid Fedun, who said on Friday, Feb. 18, that the company is interested in Lithuania's Mazeikiu Nafta, Germany's Ruhr Oel and a refinery in southern Europe. "We have a lot of offers for refining and we have to consider them seriously," Fedun was quoted by the paper. The Lithuanian concern Mazeikiu Nafta includes the Mazeikiu oil processing plant with an annual refining capacity of 12 million tons of oil and the Butinge sea terminal from which the oil can be shipped. Lukoil has been interested in the Lithuanian company for a long time. It first approached the Lithuanian government with a sale offer in 1999, but the stake was sold to the U.S. Williams International Company. In June 2002 Yukos Oil Company bought a 26.86 percent stake in Mazeikiu Nafta for $160 million. Now, taking into account the difficult financial state of the embattled Yukos, Lukoil plans to take another shot at acquiring the Lithuanian company. However, Yukos' representatives told Vedomosti that the company has no plans to sell its stake at the moment. Prior to the Friday announcement Lukoil said nothing about acquiring the German company Ruhr Oel GmbH. The company is owned on parity basis by the Venezuelan state oil company PdVSA and British Petroleum. Lukoil owns stakes in four German oil refineries — Gelsenkirchen, Bayern-oil, Miro and Schwedt with a total annual refining capacity of 50 million tons of oil. The plans to buy Ruhr Oel were announced by Alfa Group at the end of 2003. PdVSA and Alfa signed a memorandum of intentions, but the deal didn't go through. Now Lukoil plans to buy the Venezuelan company's stake. As MosNews reported several days ago, Lukoil also announced its expansion into Finland's oil product market. The Russian company bought two Finnish firms, Oh Teboil Ab and Suoment Petrooli Oy, which control one quarter of Finland's fuel market.

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