Speculation drives Mazeikiu stock to record high

  • 2005-06-08
  • Staff and wire reports
VILNIUS - Mazeikiu Nafta's share price soared by 9.5 percent on June 3, to 8.7 litas (2.7 euros) on heavy trading, pushing the refinery's market capitalization over the 6 billion litas milestone, far ahead of its publicly traded peers.

Demand for shares has been fueled by speculation, with foreign energy companies lining up to buy a controlling stake in the refinery and terminal complex from Russia's Yukos. Last week it was announced that Austria's Baltic Holding, a company associated with Russia's Gazprom, is considering investing in Mazeikiu Nafta, the Baltics' only refinery.

Robert Nowikivski, chairman of Baltic Holding, reportedly told Economy Minister Viktor Uspaskich on June 3 that the company was even prepared to supply crude to the refinery.

Baltic Holding was established by Gazprom-owned Gazprombank, which controls 55 percent of the Austrian company. Austrian companies Petrochemical Holding and Jurimex Commerz Transit control the remaining 35 percent and 10 percent of Baltic Holding.

Investment group Petro-chemical Holding, which owns a stake in Lithuania's Nemuno Banga Group, is currently participating in a PET-related project close to Klaipeda.

Baltic Holding is the third company that has openly expressed interest in taking control of Mazeikiu Nafta. The other two, TNK-BP and Lukoil, are more well known in the oil industry, though with Gazprom backing it, Baltic Holding could become a top contender.

The question is where Gazprom, a gas production and distribution company, would come up with the crude to supply the Mazeikiu refinery, which can handle 240,000 barrels per day. The gas monopoly's plans to merge with Rosneft, the state-owned oil producer, were recently scrapped.

Also, Gazprom's dominant presence in Lithuania's gas industry could become a cause for concern among Lithuanian officials. Currently Gazprom owns 37.1 percent of Lietuvos Dujos (Lithuanian Gas).

Earlier Aleksei Miller, Gazprom chairman, confirmed that the concern was interested in oil refining companies, including Mazeikiu Nafta. Miller met with Prime Minister Algirdas Brazauskas last week (see story on Page 7).

Yukos is reportedly seeking $800 - $900 million for its stake in the refinery and terminal.