NewsGermany extends control over Rosneft's refinery stake amid expropriation debate

Germany extends control over Rosneft's refinery stake amid expropriation debate

Vice Chancellor and Minister of Economy and Climate Robert Habeck
Vice Chancellor and Minister of Economy and Climate Robert Habeck
Images source: © Getty Images | Omer Messinger

5:30 PM EST, March 9, 2024

According to "Deutsche Welle," Rosneft's German unit will remain under Germany's provisional management for an additional six months. This delay allows for deliberation on whether to expropriate the shares owned by Rosneft. The decision comes amid indications from Rosneft of its interest in divesting its 54 percent stake in the refinery, a move speculated to attract Polish company Orlen as a potential investor.
Rosneft Germany, a subsidiary of the Russian consortium, possesses a 37.5 percent share, with its control solidified through another subsidiary, RN Refining & Marketing, culminating in a collective ownership of 54 percent.
In September 2022, the Berlin government mandated the transfer of the Russian consortium's shares to a temporary administration, granting the Ministry of Economy oversight. This measure effectively restricted the profits of the Russian shareholders, safeguarding them under federal management.
However, this provisional control does not equate to nationalization. The Russians have previously sought to reclaim dominance over the refinery, a move that could potentially restore their influence in the German energy sector. On the eve of the temporary administration's expiration, Rosneft's attempt to challenge this decision was dismissed by a court in Leipzig, allowing Berlin additional time to consider its next steps.
The looming threat of expropriation has since motivated the Russians to explore selling their shares.
The PCK Schwedt refinery is pivotal for fuel provision in Eastern Germany, including Berlin. With the cessation of Russian oil deliveries via the Druzhba pipeline, Poland has emerged as a crucial supply route for Northern Germany.
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