TIRANA, March 12 (Reuters) - Some 15 foreign firms have shown interest in buying 85 percent of Albania’s oil refiner ARMO, the economy minister said on Wednesday, with bids due to be opened on May 21 and a contract signed by June.
"Hungary's MOL MOLB.BU came through today," Economy Minister Genc Ruli told Reuters, "a total of fifteen firms have bought the sale documents and we expect others."
“I am happy. I didn’t think the big ones would come for a refinery processing two million tonnes a year that is located 40 km away from the sea,” he added, adding that rising oil prices might however make the state firm more attractive.
ARMO has one refinery at Ballsh, a smaller one at Fier and a small network of fuel stations selling motor oil and products.
The potential buyer -- a single company or consortium -- should be an oil and gas sector specialist with at least three years experience, a share capital of 55 million euros and certifications of international production standards.
The winner of the tender will be determined according to a points system, where three-quarters of the total points are given according to price, and one quarter for each suitor’s business and investment plan.
Ruli said ARMO had improved its performance, boasting a profit of 1.7 billion leks (13.6 mln euros) in 2006 compared to only 365 million leks in 2004. It had a share capital of 50 million euros and its assets were valued at 100 million euros.
Albania split ARMO from the tottering oil-producing arm Albpetrol before the sale to make the refiner more attractive.
Ruli said the government was hoping for the same effect when it offers the power distribution arm (DSO) of the cash-strapped KESH power utility separately for sale, likely in April.
He said the days of inefficient and unprofitable power distribution, a perennial source of power cuts in the poor Balkan country, were coming to an end.
“The new private power distributor will provide the amount of electricity required with the right quality,” Ruli said.
Potential investors would be offered no less than 56 percent and no more than 76 percent of DSO, which comes with some 140 million debt, taken to revamp its operations.
Albania’s Prime Minister Sali Berisha wants to sell major state-owned assets this year to avoid privatisations turning into a hot issue in a general election due next year.
Editing by Ellie Tzortzi
Our Standards: The Thomson Reuters Trust Principles.