Serbia is willing to pay a premium to regain control of oil refiner NIS AD as it seeks ways to unshackle the Russian-owned company from crippling US sanctions, President Aleksandar Vucic said on Sunday.
NIS’s owners, units of Russia’s Gazprom PJSC, are in talks with third-party investors from Asia and Europe who could potentially take it over, Vucic said in a live broadcast of a government meeting in Belgrade to discuss ways to resolve the dilemma.
“If they don’t agree on a purchase price, my proposal is that we offer a better price,” Vucic said. “We are ready to even overpay” for the 56 percent stake held by Gazprom units, he said.
Serbia’s only refiner is at risk of running out of crude within days after the sanctions – which took effect Oct. 9 – cut off its supply route through neighboring Croatia. Vucic and Finance Minister Sinisa Mali warned that this could have devastating consequences for Serbia’s economy and its credit rating.
The country has just a week to find a solution to avert a fuel crisis, Vucic said. “Whatever it costs, we’ll find the money,” he said.
A possible buyout by the state, which holds almost 30 percent of the refiner, would require negotiations with international financiers, and possibly a budget review to secure funding, the president said, without going into a possible valuation.
“We want to avoid confiscation, nationalization,” Vucic said. As the majority owner, the Russian stakeholders “have the right to make decisions, but we have the right to live,” he said.
Vucic cited Bulgaria’s decision last week to seize control of Lukoil PJSC’s local refinery, also threatened by US sanctions, as an example of what other countries are doing to shield their markets.
Trading in NIS shares was suspended in January, after the US Office of Foreign Assets Control unveiled the punitive measures, which took effect last month after multiple delays intended to allow time for a deal that would see Russia exit the fuel maker.
The Russian owners requested a license extension for NIS from the US last week as they sought to transfer control to a third party. But Washington rejected the appeal, insisting on a full Russian withdrawal. The move is part of President Donald Trump’s administration’s broader campaign to increase pressure on Russia’s energy sector and push President Vladimir Putin toward peace talks to end his war in Ukraine.
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