US License for Lukoil Asset Sale Expires

A US licence allowing negotiations over the sale of Lukoil’s international assets expires on Saturday, but Bulgaria’s petrol stations and the Balkans’ largest refinery are not expected to stop operating. US sanctions are pushing the Russian oil group to divest itself of its international assets, including the Burgas refinery, but no sale has yet been agreed.JOIN US ON TELEGRAMFollow our coverage of the war on the @Kyivpost_official. Saturday’s deadline applies to General License 131G, issued by the US Treasury’s Office of Foreign Assets Control (OFAC). It permits negotiations over the sale of Lukoil International, the Vienna-based holding company that owns refineries in Burgas and Ploiești, as well as a stake in an Iraqi oilfield. The licence covers talks, due diligence and contingent contracts. Any completed sale would require separate approval from Washington, subject to three conditions: Lukoil must fully relinquish control, the proceeds must be placed in a blocked account under US jurisdiction, and the company must receive no windfall. US investment fund Carlyle has been considered the leading bidder since January for a portfolio that analysts value at around $22 billion. Lukoil has already written down the value of the assets by $19.8 billion, contributing to its first annual loss. If Washington does not extend the licence, negotiations will lose their blanket legal cover. Any subsequent step would then require specific OFAC authorisation. Other Topics of Interest US Pauses Iran Strikes Amid Munitions Concerns US President Donald Trump ordered a pause in military strikes against Iran following a two-week bombing campaign, amid concerns over munitions stockpiles and ongoing diplomatic efforts in Tehran. Two separate deadlines Lukoil’s Bulgarian companies operate under a separate licence – General License 130A – which remains valid until Oct. 29 and names all four companies covered. That means Saturday’s deadline will not halt refinery operations or fuel sales. Two developments this week have nevertheless complicated the picture. On Tuesday, Bulgaria’s Constitutional Court unanimously struck down provisions allowing the refinery’s special administrator to sell the business without judicial review. The legislation had passed through parliament’s energy committee in just 26 seconds and was later vetoed by then-president Rumen Radev, before lawmakers overrode his objections. The ruling limits the administrator’s powers and restores the possibility of legal challenges to any sale. On Thursday, EU ambassadors approved the bloc’s 21st sanctions package against Russia. At Sofia’s request, Lukoil founder Vagit Alekperov was removed from the final list, along with Russian Orthodox Church leader Patriarch Kirill. The contrasting moves underline the difficult position Bulgaria finds itself in: Washington is tightening pressure on Lukoil, while Sofia is seeking exemptions intended to protect domestic energy supplies. OFAC could still extend the negotiation licence before it expires. Washington has done so seven times since November, generally granting extensions of around one month. The remaining uncertainty concerns crude supplies. In early June, Lukoil Bulgaria’s government-appointed special administrator, Evgeni Simeonov, said existing stocks would last “until the end of July”. Supplies have since resumed, with the refinery again purchasing crude through Swiss-registered traders from 1 July. No updated estimate of available stocks has been published. See the original by Konstantin Karadjov here. Euractiv is a European news website focused on EU policies. It was founded in 1999 by the French media publisher Christophe Leclercq. The website's headquarters and central editorial staff are located in Brussels, with offices in Paris and Berlin.