Albania to spin off some Albpetrol operations before relaunching sale mid-2015

22 Jan 2015  – The government of Albania is spinning off some operations of Albpetrol, the state-owned oil and gas company before the launch of a new sale process in mid-2015 according to Ervin Mete, deputy minister of Economic Development, Trade and Entrepreneurship.

In any case, the government aims to privatise a majority stake of Albpetrol by the end of 2016, a second official said.

Assets in question include some of Albpetrol’s concession agreements and joint venture contracts, Mete told Mergermarket on the sidelines of the CEE Forum in Vienna. The new tender for Albpetrol has attracted interest from potential buyers before the actual launch, Mete said without elaborating.

The World Bank’s International Finance Corporation (IFC) has been hired as consultants on the sale process, the second government official added.

The country had a parliamentary election in 2013, and the new government is keen to retain a stake of about 30% of the company and offer a majority stake, the second official said. Mete suggested however, that the government could offer its entire 100% stake in Albpetrol once this restructuring has been completed.

An earlier sale attempt of Alpetrol failed in early 2013. The previous government failed to close a deal with Vetro Energy, because the Chicago-based oil company could not raise the EUR 850m it had offered for Albpetrol, as previously reported. Bankers Petroleum, the Canadian-based oil and gas producer, offered EUR 106m and China’s Win Business Petroleum bid EUR 297m.

Patton Boggs served as an adviser for the previous sale attempt but that mandate expired after the previous tender in 2012, as reported.

Mete said that the price achieved for Albpetrol would probably be lower than last time given that some of its operations are to be spun off. In 2012 the government assessment of Albpetrol’s assets was EUR 320m, as earlier reported.

Albpetrol’s main activity is the production and marketing of petroleum products as well as the monitoring of petroleum agreements, according to its website. Five companies have signed petroleum agreements with Albpetrol: Bankers Petroleum Albania, Sherwood International Petroleum, Transoilgroup Stream Oil & Gas Limited and Phoenix Petroleum.

by Katka Krosnar and Katie McQue

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