ECONOMY

Oil refiner is excluded from Croatia bid

Croatia has removed a consortium of Italy’s Edison Gas and Hellenic Petroleum of Greece from bidding for a 25-percent stake in oil and gas group Ina, the company said yesterday. In a brief statement, Ina said the consortium – formed after Edison was short-listed as a potential strategic partner for Ina – was not regarded as satisfactory. Hellenic teamed up with Edison after failing to make the shortlist itself. «Edison’s share in the consortium was limited to 20 percent, which the (Croatian) government thought too small, since the Italians had won the right to do due diligence on their own and Hellenic failed to make it,» a source close to Ina told Reuters. «In theory, Edison could now terminate the consortium and proceed with due diligence on its own,» the source said. Edison was short-listed as a potential buyer for the stake in Croatia’s biggest company in July along with Hungary’s MOL, Austria’s OMV, Russia’s Rosneft and Lukoil. Ina is now 100 percent state-owned. Of the remaining four bidders, three have completed due diligence and Lukoil is scheduled to do so next week. Binding offers are expected by the end of the year and the sell-off is likely to be completed in the first quarter of 2003. Ina’s 2001 output was 2 million tons of crude and 1.8 billion of cubic meters of natural gas, but last month it sold its Siberian oilfields «White Nights,» which accounted for one-third of its total crude output, to a Russian firm. Balkan springboard Ina is a dominantly upstream company, focused on refining and sales, with good retail market potential. It is viewed as a springboard for expansion in the Balkans and is linked via a pipeline from the deep-sea terminal at Omisalj in the northern Adriatic to Hungary and Russia in the northeast and Yugoslavia in the east. The buyer will have to invest up to $360 million in Ina’s two dated refineries and keep all of its 17,000 work force as well as its oilfields for a period of three years. The company has been valued at 1.2-1.8 billion euros by sell-off advisers Deutsche Bank and PricewaterhouseCoopers. (Reuters)