US Extends Deadline for Buyers of Lukoil’s Global Assets to June 27
Extension of License and Impact on Lukoil’s Asset Sales
Background of the License Extension
May 28 (Reuters) - The United States on Thursday extended by one month to June 27 a license allowing companies to hold talks with Russia's second-largest oil producer Lukoil on buying its foreign assets, the U.S. Treasury Department said.
Sanctions and Their Implications
History of Sanctions on Lukoil and Rosneft
The U.S. has now extended the deadline about six times since imposing sanctions last October on Lukoil and state-owned Rosneft for the role their revenues play in supporting the more than four-year war in Ukraine.
Forced Sale of International Portfolio
The sanctions forced the sale of Lukoil’s international portfolio, valued at about $22 billion, including oilfields, refineries and gas stations from Iraq to Finland. The process has attracted interest from more than a dozen bidders, ranging from U.S. oil major ExxonMobil to the former owner of Pornhub.
Requirements for Potential Buyers
Financial and Legal Conditions
No Upfront Payment and Frozen Proceeds
Any deal must ensure that Lukoil receives no upfront payment, with all proceeds placed in a frozen account under U.S. jurisdiction. Transactions also require final approval from the Treasury Department's Office of Foreign Assets Control.
(Reporting by Timothy Gardner, Bhargav Acharya and Ismail Shakil; Editing by Sanjeev Miglani)
