Sberbank, SOCAR Create Oil Refining Joint Venture in Azerbaijan

Azerbaijani state-owned company SOCAR and Russia’s biggest bank, Sberbank, have created a joint venture for oil refining at the Antipinsky Refinery, Kommersant reported.

It is expected that the joint venture, where SOCAR has 60 percent, will conduct processing works at the plant while it is in a state of bankruptcy, the business newspaper writes.

“It is also possible that the joint venture will develop the fields in [Russia’s] Orenburg Province that are part of the refinery,” the report said.

According to Kommersant’s sources, SOCAR wants to start processing at the Antipinsky Oil Refinery by July of this year, and there is information that the joint venture will buy oil from large oil companies, in particular from Lukoil and Surgutneftegaz.

In April, Russia’s Sberbank obtained 100 percent in Cyprus’ Vikay Industrial, which owns 80 percent of Antipinsky Oil Refinery, while the remaining 20 percent of the shares belong to various other individuals and legal entities. Three weeks later, the management of the company filed a lawsuit to declare Antipinsky Oil Refinery bankrupt. Its total debt to banks is estimated at $5 billion.

Earlier, Sberbank’s CEO and chairman of the executive board Herman Gref said the bank was continuing negotiations with potential investors on the sale of the refinery but did not confirm that SOCAR was a key contender for the purchase of the refinery’s shares. According to Gref, a final decision has not yet been made.