The Boring End of the "Lukoil - Bulgaria" Opera

Editorial |Author: Ivan Dikov | January 16, 2012, Monday // 15:03|  views

Bulgaria's Customs Agency awarded Monday to the Lukoil Neftochim refinery in the Black Sea city of Burgas protocols certifying compliance of its measuring equipment with state requirements.

Thus, the great "Lukoil - Bulgaria" Opera (or saga if you prefer) came to an end without much fanfare – unlike the way it started in July 2011 when Bulgarian Prime Minister Boyko Borisov and Customs Agency chief Vanyo Tanov played it tough against Lukoil Bulgaria and its CEO Valentin Zlatev, who is said to be Bulgaria's major oil oligarch.

The July 2011 "Lukoil - Bulgaria" crisis was so impressive that at one point the Lukoil Neftochim refinery – the largest on the Balkans – seemed doomed to be shut down altogether - or so both Borisov and Zlatev would have had you believe. The problem was the refinery's failure to install new measuring devices, which are required as part of the Bulgarian government's plan to crack down on fuel contraband.

Interestingly, only a few days later a court ruling gave Lukoil Neftochim its license back for the duration of the "investigation", and it was much ado about nothing – save for a boost of PM Borisov's ratings since after all he was "taking on" one of the top Bulgarian oligarchs. Meanwhile, the courtroom saga as to whether Lukoil had committed violations dragged on.

They did put up a good show – for those who believed them. Because, leaving conspiracy theory aside, there are two major reasons the clash between the Bulgarian government and Lukoil Bulgaria seems 100% fake.

First, there is the well-known close friendship between Prime Minister Boyko Borisov and Lukoil Bulgaria CEO Valentin Zlatev. Actually, tons of online publications claim that Zlatev is actually Bulgaria's back-seat ruler. Couldn't have Zlatev and Borisov cooked up the whole thing to give the Cabinet a boost? You answer for yourself.

Second, even if this whole backseat ruler thing about Zlatev is untrue, there is an even more compelling reason to believe that the Borisov Cabinet was at least bluffing (if it wasn't part of a backstage game): the Lukoil Neftochim refinery is not only the only oil refinery in Bulgaria – but it is also about the largest taxpayer and makes up 10% of the Bulgarian GDP. Under these circumstances no sane state leadership would have gone for shutting it down regardless of what measuring devices it might be lacking.

So, even though the court trial about the refinery's license is technically still dragging on, the Lukoil Bulgaria opera is over with a "boring" end. It might have cost the oil company a few million BGN but it did buy a rating boost for the Borisov Cabinet. And the precious measuring devices got installed with a great delay as they would have been anyway, without the need for any grand opera performances.

This article in BULGARIAN

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Tags: Excise Duties and Tax Warehouses Act, Rosenets oil terminal, refinery, Lukoil Neftochim Burgas, Customs Agency, Vanyo Tanov, National Revenue Agency, NRA, Valentin Zlatev, oligarch, Boyko Borisov, Prime Minister, Lukoil Bulgaria, Lukoil


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