Sicily Refinery sold to Cypriot fund Argus by Lukoil

Largest oil refinery in Italy, the Syracuse plant.

 ROME – Syracuse oil refinery has been sold by Russian giant Lukoil to Cyprus stock fund Argus, as reported in the market. G.O.I Energy, a division of Argus, has received the plant, as announced by Lukoil, the new owner. 

 Russia controls the plant through another company, Swiss based Litasco. The Sicilian plant has been critical to Italy – about 20% of refined products consumed in Italy come from the one plant. Reported in Nov. 2022, the refinery risked operational problems due to the embargoes against Moscow that Europe had put in place. The plant could no longer obtain product from its parent company and had issue finding other bank guarantees for access to other markets. The talk of sale, particularly in the interest of U.S. markets ensued.

 The government had also hypothesised the start of extraordinary administration to ensure the continuity of operations of the plant, which employs a thousand people in the Syracuse area. "The transaction is subject to the occurrence of certain conditions precedent relating to," the agreement states, "among other things, the obtaining of authorisations from all competent authorities, including the Italian government. The transaction is expected to close by the end of March 2023.”

 Trafigura, Italian commodity trading giant, also plays a role in the deal, since being signed into sales of crude oil supply with Litasco. "We are pleased to announce that we have reached an agreement with Litasco. We are keenly aware of the importance of Isab for the Italian economy, for Sicily and for the local community. We firmly believe that Isab has an important development potential, and we have a solid business plan to enhance it. Working closely with the Italian government, we are optimistic that the transaction will be successfully completed,” said Michael Bobrov, CEO of G.O.I. Energy.

 The Cypriot group was assisted in the transaction by the law firm Bonelli Erede, while Ernst & Young acted as financial advisor. Environmental concerns are now also the responsibility of the new Cypriot owner, to be done in accordance with the Italian and Cypriot governments. 

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