Orlen completes buy of Lithuanian Mazeikiu refinery

14 December 2006 17:47  [Source: ICIS news]

PRAGUE (ICIS news)--Poland’s PKN Orlen on Thursday completed the purchase of 53.7% of Lithuania’s Mazeikiu Nafta oil refinery from Russia’s Yukos for litas 3.88bn (€1.12bn/$1.48bn).

Orlen – which intends to turn Mazeikiu Nafta into an oil/petrochemicals complex – expected to complete the second stage of the acquisition, involving the purchase of the Lithuanian government’s 30% stake in the company for litas 2.23bn, tomorrow (15 December).

The deal gives Orlen control of the only oil refinery in the Baltics.

Its so far announced plans for Mazeikiu include a €759m investment programme comprising commitments such as a €174.7m polypropylene (PP) plant.

The acquisition is going ahead despite serious damage caused by a blaze at the refinery in October.

Since July, Mazeikiu Nafta has also been hit by a Russian freeze on pipeline crude oil deliveries.

The consensus of analysts has been that Russia has cut off the oil after being angered by Lithuania’s decision not to sell the facility to a local firm, although Russia claimed the pipeline was in disrepair.

($1 = litas 2.62)

By: Will Conroy
+44 20 8652 3214

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