Eni, Gazprom refinery deal could hit Unipetrol's expansion strategy

15 March 2011 17:53  [Source: ICIS news]

PRAGUE (ICIS)--Italy's Eni and Russia's Gazprom are discussing a deal for a stake in a refiner that could impact on the petrochemical expansion strategy of the Czech Republic's Unipetrol, a source at Unipetrol said on Tuesday.

Eni had informed Unipetrol that it was in talks to sell its 32.5% stake in main Czech refiner Ceska Rafinerska, he added.

Unipetrol holds a 51% stake in Ceska Rafinerska, but production sharing agreements with the other shareholders limit the amount of output, including petrochemical feedstock, that it can source from its two refineries.

"We have long looked at the possibility of building up our shareholding in the company, partly to give us options on more petchem feedstock," said the source.

"We can theoretically block any deal between Eni and Gazprom because we have option of first refusal on the stake, but we would need to put in a better bid than Gazprom to do so," he added.

Czech energy security officials remain wary of allowing energy powerbroker Russia into the Czech Republic's refining sector.

When in 2009, Royal Dutch Shell let it be known its 16% stake in Ceska Rafinerska might be divested if a good bid was received, Czech state-run pipeline operator MERO suggested it should consider placing a bid to prevent a Russian company acquiring it.

Ceska Rafinerska runs a refinery in Litvinov, a location near the northern border with Germany where Unipetrol's main petrochemical units are also based, and a small refinery in Kralupy nad Vltavou, near Prague.

By: Will Conroy
+44 20 8652 3214

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