US sanctions prompt Bulgaria, Serbia to target Russian energy assets

Following the rollout of US sanctions targeting Russia, the Bulgarian government has seized the “Neftekhim” facility along with other Lukoil assets, while the Serbian government is exploring the potential acquisition of Naftna Industrija Srbije AD from its Russian owner, Gazprom.

Bloomberg reports that prior to the sanctions, Lukoil operated the largest oil refinery in Bulgaria. In response to the new restrictions, Sofia moved quickly to confiscate the Neftekhim facility near the Black Sea, along with additional company holdings. Shareholders were stripped of their rights, and a government-appointed manager was tasked with negotiating a potential sale.

According to Bloomberg, Bulgaria’s parliamentary committee approved the measure in just 26 seconds, nullifying 26 years of ownership ahead of the US-imposed deadline.

In Serbia, authorities are considering a similar strategy to bring Naftna Industrija Srbije AD under domestic control by buying out Gazprom. President Aleksandar Vučić aims to avoid full nationalisation but must reassure Washington of his intentions to divest the Russian stake to sidestep sanctions.

Mario Bikarski, senior European analyst at research firm Verisk Maplecroft, said that completing the removal of Russian oil companies from Bulgaria and Serbia would significantly weaken Russian President Vladimir Putin’s influence in the region.

Prospective buyers from the US, Europe, and the Persian Gulf have already expressed interest in the assets. Lukoil confirmed on November 19 that it is taking “all necessary steps” to sell the Neftohim refinery, its gas-station network, and other holdings in Bulgaria.

“The question is not whether the transition away from Russian ownership will eventually happen — it will,” said Ilian Vassilev, Bulgaria’s ambassador to Moscow in 2000, shortly after Neftohim’s privatisation. “The real question is whether Bulgaria will shape that process — or be shaped by forces entirely beyond its control.”

By Tamilla Hasanova