Williams will stay in Lithuania

  • 1999-03-11
  • Peter J. Mladineo
VILNIUS - Amid reports that Williams International would either withdraw from Lithuania or reduce its investment in the state-owned Mazeikiu Nafta concern, assurances to the contrary are piling up.

Earlier this week the daily Lietuvos rytas reported that Williams International President John Bumgarner told Parliament Chairman Vytautas Landsbergis that Williams was still doing the deal.

The Lithuanian government and the U.S. concern were planning to sign the deal under which Williams acquires 33 percent of Mazeikiu Nafta's shares March 8, but the signing was postponed.

Last week, Respublika reported that monetary losses at Mazeikiu Nafta had given the Americans cold feet making Williams postpone the signing date. The Mazeikiai concern posted a 97.9 million loss ($28.8 million) in 1998.

Respublika said the U.S. company was now feigning disinterest to get a lower price from the government.

However, a Williams spokesman has gone on record saying that those reports were "premature."

"Williams is still very excited by the deal," said Darius Silas, a Williams public affairs and media representative. "It has not presented the government with an offer that would reduce its investment."

Currently the Mazeikiai refinery has a capacity of roughly 6 million tons per year. Williams feels that the refinery could attain a projected capacity of 15 million tons per year.

However, Silas added, Williams and the Lithuanian government still have some financial matters to iron out.

"Regardless of the financial situation at Mazeikiu Nafta, including those losses, Williams is still very focused on the deal. Williams looks at this investment as a priority," he said.

Kazys Bobelis, an MP representing the Christian Democratic Union, discredits the rumors about Williams holding out for a better price for what would be a controlling interest in the concern.

"I don't think Williams is bluffing," said Bobelis. "Someone else is trying to give that impression to the Lithuanian people. Some other companies that are interested in obtaining a controlling interest are trying to introduce the impression that Williams will not be able to live up to its agreements."

The proof that a Williams pull-out is unlikely is in the fine print, Bobelis added. The initial agreements Williams made with the government contain provisions stating that if one party did not live up to the contract, they would be financially responsible for damages, he explained.

"Last week the U.S. ambassador made it quite clear that Williams' intentions are sincere, and it has no other alternative but to come to Lithuania," Bobelis added.

Parliamentary information is currently assuming that Williams will sign on May 15 and make the first financial installments on June 1, said Bobelis. However, Williams isn't in agreement.

"At this stage Williams is not going to talk about any dates," said Silas.