Germany Nears Decision on Fate of Seized Russian Oil Operations

Germany close to deciding fate of seized Rosneft units, 2 years after Ukraine invasion. Government weighs options for Russian oil company.

Story from Bloomberg, via| Michael Nienaber & Petra Sorge| Germany is nearing a decision on what to do with the local units of Russian oil major Rosneft PJSC that the government seized two years ago after Moscow invaded Ukraine.

A government official familiar with the matter told reporters Monday that the future of the assets will be determined soon. The state-controlled Russian energy giant agreed with Germany earlier this year to try to find a buyer for its local subsidiaries, but the deadline to do so will expire in two months.

According to people familiar with the discussions, two to three interested parties have started sounding out a possible investment. The people added that talks about a potential purchase of Rosneft Deutschland and RN Refining & Marketing GmbH have already been held in Berlin, asking not to be named because the matter is private.

Spokespeople for the German economy ministry and Rosneft Deutschland declined to comment.

In September 2022, at the height of an energy crisis, Germany put Rosneft’s local units under temporary trusteeship, which has since been extended three times. The deal that closed in March allowed the company to find its own buyers for the entities while avoiding nationalization. That option is not off the table, with parts of Chancellor Olaf Scholz’s three-party coalition supporting such a move.

The Rosneft units have shares in three oil refineries in Germany, including the PCK Raffinerie GmbH in Schwedt near Berlin, which was cut off from Russian crude supplies two years ago.

German Deputy Economy Minister Michael Kellner told reporters that the PCK refinery would not fall back under Russian control. He didn’t specify how far Rosneft’s negotiations had progressed with interested parties or whether he would prefer a Polish buyer for the shares.

“It’s important to me that we create an ownership structure so that we have the refinery on a secure footing in the long term,” Kellner said.

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