Lithuania rejects renewed refinery sale-talk

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The Lithuanian government on Monday dismissed as pure speculation renewed suggestions that Polish energy group PKN Orlen would sell the Baltic state's only oil refinery to a Russian company.

Prime Minister Andrius Kubilius said there was nothing to back rumours that Orlen Lietuva -- the Polish group's Lithuanian arm -- would be sold off.

"I've heard similar rumours and speculation for the past 18 months, or almost two years, but I see no real facts that should be commented on. We do not react to rumours," Kubilius told journalists.

Kubilius took the Poles to task for failing to squash the sale talk.

He said the stance was doing little to encourage Lithuania to help settle sparring with PKN Orlen over logistics for the refinery, which is based at Mazeikiai in northwest Lithuania.

The sale-talk stepped up a notch after PKN Orlen recently appointed Nomura Bank to advise it on the future of Orlen Lietuva.

"Hiring an advisor for a sale does not mean a sale itself," Lithuanian Energy Minister Arvydas Sekmokas said.

"We do not have any official information. The situation has not changed in the past six months," he told reporters.

PKN Orlen and Lithuanian authorities have been wrangling over a state-owned oil terminal near Klaipeda on the Baltic coast, which the refinery uses to export its output.

PKN Orlen has expressed interest in buying the terminal, but the government, dubbing it a strategic asset, has refused to sell.

Orlen Lietuva has to use the terminal because a pipeline to Russia remains switched off.

In July 2006, shortly after PKN Orlen bought a stake in the Lithuanian refiner, Russia's fuels transport giant Transneft turned off the tap on its Druzhba oil pipeline serving Lithuania claiming it required repairs.

© 2010 AFP

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