How will the sanctions against Russia affect the oil refinery in BiH? – Sarajevo Time

The takeover of Sberbank’s European branches, including those in the country, is the first consequence felt in Bosnia and Herzegovina (BiH) due to the sanctions against Russia. How will other Russian companies continue their activities and will an economic “bailout” be applied to the Bosanski Brod oil refinery?

Bentonite and coal from LjesljanI are natural resources for which the Republika Srpska (RS) has granted a concession for 30 years. The companies and successors of the Russian oligarch Oleg Burlakov are not giving up on the project.

EEuropean Union (EU) embargo on imports of Russian crude oil

Miroslav Drljaca, Mayor of Novi Grad points out:

If there will be a realization, Good most of the time, some interest in this location is related to the inability of the Russian capital to participate in EU economic processes, so there is greater interest in activating this project. Looking forward to all these years, I can’t say I’m not optimistic, or that I don’t believe in it, but I’m sure it’s still a long way off.

Far from where work started is the Bosanski Brod refinery, which has not been in operation since the 2018 disaster. import of Russian crude oil will come into effect on May 15.

Neighboring Serbia is exempt from the oil sanctions package and will continue to deliver black gold to Pancevo via the Adriatic pipeline. thego the price, it is believed, was a vote against Russia at the United Nations (UN).

These sanctions refer to the ban on importing Russian oil into the territory of Serbia. We don’t have this problem. Our refinery does other work with gas imports. You know that a gas pipeline was built to the refinery from Croatia. About a month ago, the refinery applied to the government for a concession for the construction of a gas-fired power station within the refinery, says Radovan Viskovic, Prime Minister of the RS.

Bankruptcy for tax debt

The Russian group Optima received a license from the RS Energy Regulatory Commission (RERS) to trade in gas in August last year. Four months later, a gas compressor station is put into operation at the Brod oil refinery. Is oil the past for Brod and gas the future?

NeftegazInKor is the largest Russian investment in BiH. In 2007, the company became 100% owner of Brod Oil Refinery, Modrica Oil Refinery and a chain of distribution companies. The majority owner of NeftegazInKor is the Russian state company Zarubezhneft.

Economist Sinisa Pepic believes there are several scenarios for the refinery. From bankruptcy for tax debt, to “bailout”. He says it’s possible:

That the government of the RS take over its ownership according to the same model as the Sberbank, conditionally speaking nationalizedi.e. finished bailout. Another model, known in the banking sector, is the bail-in, where the company’s creditors take control of the company. All this must be done with the owner’s consent. But seizing property, whether from a Russian owner or someone else, is not in line with good business practice.

RS authorities strongly oppose BiH state joining EU sanctions against Russia.

About Eleanor Blackburn

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