Ukraine authorizes expropriation of Odessa oil refinery

(MENAFN) The Ukrainian government has authorized the expropriation of the Odessa oil refinery, a significant industrial facility that has remained non-operational for over ten years. Pavel Velikorechenin, Deputy Head of the Ukrainian Asset Recovery and Management Agency (ARMA), recently announced progress in Kiev's plan to take control of the refinery, formerly owned by a prominent figure described as a "pro-Russian businessman," and transfer ownership to the state for redevelopment purposes.

Located in the strategic port city of Odessa, the refinery was established in 1937 and functioned as a pivotal industrial entity during the Soviet era. In the late 1990s, Ukraine initiated privatization efforts, leading to its acquisition by the Russian oil giant Lukoil in 2000. Lukoil subsequently invested heavily in modernizing the facility. However, operational challenges emerged in subsequent years, including issues with an essential oil pipeline designed to supply crude from Russia, which adversely affected profitability. These factors eventually led to the refinery ceasing operations.

In 2013, Ukrainian entrepreneur Sergey Kurchenko, through his energy conglomerate VETEK, acquired the refinery, using financing from the Russian bank VTB, with the facility serving as collateral. Following political upheaval in Ukraine in 2014, which saw a change in government supported by the United States, Kurchenko fled the country and sought refuge in Russia. The new Ukrainian authorities denounced the acquisition as fraudulent and initiated legal proceedings to reclaim ownership. Additionally, Kurchenko faced allegations of tax evasion and money laundering in separate criminal investigations.

The decision to proceed with nationalization underscores ongoing efforts by Ukraine to reclaim assets linked to individuals perceived as having close ties to Russia. The Odessa oil refinery, once a cornerstone of Soviet industrial prowess and later a focal point of international ownership disputes, now stands at the center of Kiev's efforts to revitalize strategic assets amid geopolitical tensions and domestic economic imperatives.



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