Sovfracht acquires Mari El Refinery

According to Russian business daily Kommersant (8 November 2012), Russian logistics operator Sovfracht is acquiring the Mari El Refinery located 45 kilometres from Yokshar-Ola, which has been valued at an estimated USD 200-300 million.  The refinery has a capacity to refine 1.3 million tonnes of oil a year, with 40 per cent of output exported.

Over the past year fuel oil exports have been on the rise, while sales on the domestic market has contracted. The owners of Mari El Refinery had been seeking a buyer for a while, but to no avail, in part owing to the refinery’s poor state  at present. Recently it had been announced that the refinery planned to borrow RUB 60 billion on the refinery’s upgrade.

The purchase appears surprising, as Sovfracht is first and foremost a logistics business. It may be that the operator plans to sell on the refinery after its upgrade.

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