Kazakhstan’s state-owned KazMunayGas is understood to be bidding to acquire Lukoil’s Bulgarian refinery, Bloomberg reported on January 7, quoting two sources close to negotiations.

The Bulgarian refinery is Lukoil’s biggest asset and is the largest refinery in the Balkans. Lukoil has been indicating it wants to sell it along with petrol filling stations in Bulgaria since December 2023, as Sofia has banned the import of Russian crude oil.

According to Bloomberg, Litasco SA, the Lukoil-owned company that owns Lukoil Neftochim Burgas, has received several binding offers for the refinery, including one from KazMunayGas.

The Kazakh company is reportedly discussing financing of the acquisition with Vitol Group.

According to one of Bloomberg’s sources, KazMunayGas, which already processes Kazakh crude at its Petromidia refinery in Romania, expects to complete the acquisition of Lukoil Neftochim Burgas in around a month and the price is seen at $1bn.

The Kazakh company will seek guarantees that Litasco would not transfer the money to Russia.

In December, Hungarian Prime Minister Viktor Orban said that MOL is also bidding for the Bulgarian refinery, but that was not confirmed officially. At the time, Bulgarian public broadcaster BNT reported that MOL had submitted a bid, along with six other candidates in a tender for the sale of Lukoil Neftochim Burgas. Orban also said that MOL is the only candidate located in an EU member state.

Orban said the final decision on which bidder the refinery will be sold to will be made by the Bulgarian state, which holds a golden share in the refinery.

However, Bulgaria’s caretaker Energy Minister Vladimir Malinov said that the state cannot interfere in the sale of Lukoil’s refinery as it is private property, but it will seek detailed information regarding the potential deal.

In November, the Financial Times reported that Lukoil was in talks on the sale of the refinery with a Qatary-UK consortium comprising Oryx Global and DL Hudson. The Russian company denied the report.

Meanwhile, Azerbaijan has also expressed an interest in acquiring the refinery.

Back in December 2023, then finance minister Assen Vassilev said that a possible sale of Lukoil’s business in the country did not pose a risk of the refinery having insufficient fuel, as the government already knew the company was preparing a sale. Vassilev added that the refinery’s operations should be secured with the appointment of a state representative.