Venezuela sells share in German refiner to Rosneft

15th October 2010, Comments 0 comments

Russian state oil giant Rosneft signed an agreement with Venezuela on Friday to acquire its 50-percent stake in German refining firm Ruhr Oel GmbH for 1.6 billion dollars.

The agreement was signed by Venezuela's state-owned oil giant Petroleos de Venezuela (PDVSA) and Rosneft at a ceremony in the Kremlin during a visit by President Hugo Chavez and President Dmitry Medvedev.

The agreement will give Rosneft, Russia's biggest oil firm, a key foothold in the European market.

Ruhr Oel has been a joint venture between Venezuela and the German arm of British energy firm BP. PDVSA has been involved with Ruhr Oel since 1983, when it was a joint venture with Veba Oel until the latter's takeover by BP in 2002.

"Rosneft will pay 1.6 billion dollars for the 50 percent stake," Rosneft said in a statement.

"As a result of this acquisition, 18 percent of Rosneft's refining capacity will be located in the heart of industrialised Europe," said Rosneft's President Eduard Khudainatov.

"This transaction is consistent with our strategy to expand our presence with high quality assets in key international markets."

The statement said Ruhr Oel's aggregate equity refining capacity in the four plants where it has stakes is 23.2 million tonnes per year, amounting to approximately 20 percent of total German refining capacity.

Speaking on national television before his visit, Chavez said PDVSA had agreed to sell a stake in Ruhr Oel as it "frees us from an asset that we do not need."

"It allows us to invest in other areas. It is a very important agreement for both (parties)," he added.

BP Europa said in a statement that it was happy with the deal and Ruhr Oel business would carry on as before. BP already has close cooperation with Rosneft and a 1.4 percent stake in the company.

"We are happy to continue the success story of the joint venture next year with our new partner Rosneft," said BP Europa chief executive Uwe Franke in a statement.

BP has said it has no plans to sell its stake in Rosneft despite hoping to sell a range of assets to finance its losses after the Gulf of Mexico oil spill.

© 2010 AFP

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