Italian officers are racing to assessment a deal to promote the nation’s largest refinery after the US authorities privately raised issues in regards to the sale of the Russian-owned web site to a little-known fund in Cyprus.
Russia’s Lukoil agreed in January to promote its Sicilian ISAB refinery to GOI Power, a newly established department of the Cypriot non-public fairness group Argus.
The €1.5bn deal, which overtook a competing offer from US-based Crossbridge Power Companions and oil dealer Vitol, additionally includes commodity dealer Trafigura. Trafigura will present working capital and crude oil to the power, and market the refined fuels its produces.
The transaction was anticipated to shut by March 31, however Italian officers are taking further time to assessment essential particulars, in line with two individuals briefed on the talks.
The extra time was required partly after the US authorities informally requested Rome to verify that there is no such thing as a Russian involvement in GOI Power, the 2 individuals and one different additionally briefed on the talks stated.
The ISAB refinery is among the largest industrial websites in western Europe. It may possibly course of 320,000 barrels of oil a day, a couple of fifth of Italy’s refining capability. Rome stopped in need of nationalising it final yr after Russia invaded Ukraine however positioned it below a brief trusteeship, giving it a veto over any deal to promote it that would jeopardise operations or jobs.
Trafigura confirmed that executives together with its co-head of crude oil buying and selling Ben Luckock had met Italian officers this week to “reply their questions” however stated the assembly had been “optimistic” and that the method was advancing.
GOI Power is run by chief govt Michael Bobrov, who used to go Trafigura’s operations in Israel.
One Italian official and one individual near GOI Power stated they have been “optimistic” the deal can be accredited subsequent week.
The US State division declined to touch upon any communication between US and Italian officers over the deal. It added that Lukoil and its Italian operations are usually not topic to US sanctions however confused the necessity for scrutiny of any transaction involving Russian vitality belongings.
“It is very important recognise that the Russian authorities works aggressively to undermine judicial processes in america and Europe, particularly in regard to sanctioned entities, so these instances have to be handled with utmost scrutiny and safety,” the US division stated.
GOI Power stated it had supplied the Italian authorities with full ensures on governance, manufacturing, monetary and employment continuity in addition to vitality safety.
It categorically denied any Russian involvement in its funding or operations, saying its investor combine is “completely of Greek, Israeli and Cypriot”. It added that GOI Power’s chair, Christodoulos Damianou, is Ukraine’s consul in Cyprus.
However two of the individuals briefed on the talks stated Italian officers have been nonetheless fearful about some features of the transaction.
One senior Italian vitality govt stated it was worrying that “a gaggle of unknown buyers, operating a newly created entity out of Cyprus, might purchase an asset deemed strategic by Rome”.
A spokesperson for Italy’s authorities declined to remark.