| Leonid Kuchma ordered Naftogaz of Ukraine to add oil refineries Ukraine decided to follow the example of Russia and also strengthen the position of its national gas and oil monopolist, Naftogaz of Ukraine. Only she will do this in an even more extravagant way: Leonid Kuchma yesterday signed a decree on the creation of a vertically integrated oil company (VIOC) based on Naftogaz of Ukraine. To do this, the company, by the end of September, will buy back state-owned stakes in the two largest Ukrainian oil refineries, Galicia and Ukrtatneft (formerly the Kremenchug Oil Refinery), at market prices. True, experts predict that it will be much more difficult to implement this deal than the Russian one regarding the takeover of Rosneft by Gazprom - the refinery has minority shareholders who, during the presidential election campaign, are ready to argue with the current government.
The idea of creating a vertically integrated oil company on the basis of Naftogaz of Ukraine was born three years ago. At that time, foreign (primarily Russian) oil companies were completing their expansion into the Ukrainian market, and the state intended to increase the presence of national companies that would create competition in this market. “The idea of a vertically integrated oil company is good, but a lot of time has been lost,” says the director of energy programs at the Ukrainian Center for Economic and Political Research. Razumkova Vladimir Saprykin. -- Having transferred controlling stakes in two refineries to vertically integrated oil companies, the state will not be able to manage them. Both “Ukrtatneft” and “Galicia”, in addition to the official owners of private stakes, have unofficial ones who have claimed to buy out large state-owned stakes. Therefore, the state now needs to either negotiate with several owners regarding the exchange of shares (since shareholders usually have the right to be the first to buy out the stake being sold) in order to completely “buy out” at least one refinery, or “not start this game.”
"Galicia" and "Ukrtatneft" process a total of 4.7 million tons of oil, while all six existing Ukrainian refineries process about 10 million. The goal of vertically integrated oil companies is to occupy 30-40% of the Ukrainian retail petroleum products market (currently 16 %), says the head of Naftogaz of Ukraine Yuriy Boyko. To achieve this, the network of jobber gas stations will be almost doubled: in addition to the existing 450 gas stations, the company will purchase about 300 more from Ukrtatnafta. These gas stations will sell Russian and Ukrainian petroleum products. In addition, since 2007, Mr. Boyko has promised to export another 1.5 million tons of Libyan oil to Ukraine thanks to the work of Naftogaz of Ukraine there.
In addition to the fact that it will not be easy for the government to enforce Leonid Kuchma’s decree, it will have to look for ways to resolve the political conflict around the Galicia and Ukrtatnafta oil refineries. Last week, the Cabinet of Ministers announced its intention to transfer these refineries free of charge to Ukrnaft, a monopoly enterprise in which a significant portion of the shares belongs to private individuals. In protest against the decision on the “redistribution of property,” 15 deputies left the parliamentary majority. The oil conflict is associated with the name of the Yaroslavsky brothers - businessmen and deputies of the Rada. The Kharkov group "Ukrsib", whose interests they represent, owns only about 1% of the shares of "Ukrtatnafta" (another 55% belongs to businessmen and the state property committee of Tatarstan). However, this group apparently claimed to buy out the entire share of state shares - 43%. “The President (Leonid Kuchma. - Ed. ) changed the previous decision (of the government. - Ed. ) on the free transfer of the state stake in two Ukrnafta refineries in order to extinguish the conflict in the Rada,” said Rada deputy Yuriy Orobets. - This is what is connected with his decree on the creation of a vertically integrated oil company and the sale of stakes in two refineries to this company. However, this step does not solve the problem of businessmen interested in an open competition for the sale of state shares.” Svetlana STEPANENKO, Kyiv |
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