Govt approves Albpetrol’s sale, despite opposition

TIRANA, Dec. 14 – Majority MPs of the Legal Affairs Parliamentary Committee have paved the way for the privatization of oil company Albpetrol, the most important remaining wholly state-owned asset. The draft law foreseeing the sale of 100 percent of Albpetrol’s shares was approved this week amid debates with opposition MPs accusing government of lack of transparency with the sale of the oil extraction company, and warning they would vote against the draft law in Parliament.
Zamir Stefani, the legal affairs director of the Economy and Energy Ministry, which is responsible for organizing the tender procedures, said Albpetrol’s buyer will have full exploration rights on the company’s oil wells, paying only a resource tax.
“Under this privatization process, government targets ensuring private investments in the oil sector, to improve technology, the management system as well environmental standards creating the conditions for the liberalization of the hydrocarbon market,” says Parliament’s press office.
“I would like to make myself clear; the bidders will buy the oil well’s assets but not the oil well itself. Thus, the resource remains under state ownership and the buyer only explore them as the state would do, becoming resource owners but not oil well owners,” Stefani noted.
Erjon Brace, an opposition Socialist Party MP described the government’s intention to sell Albpetrol as a national crime. In a comment posted on his Facebook profile, Brace said no regime since Albania’s independence in the early 20th century had dared sell Albania’s national reserves.
“We are against the privatization of exploration rights for our national heritage especially in oil and chromium,” wrote Brace.
The new procedure for Albpetrol’s sale was decided after consultations with US-based Patton Boggs, which last year was selected as an international consultant for Albpetrol’s sale preparing a report on the method of privatization. The company’s market value has not been determined yet and no date set for the international tender for its sale.
Albpetrol Sh.a. is a 100 percent state-owned company experienced in oil and natural gas extraction. It was set up in 1999 after the split of the state-run Albanian Petroleum Corporation (APC). It sells its product to the Albanian Oil Refiner ARMO, but also has full legal rights to export it.
Along with the insurance company INSIG, Albpetrol is one of the few remaining fully state owned assets.
Last year, Canadian-based Bankers Petroleum expressed its interest in buying Albpetrol. In March 2011, Bankers took over production and royalty payments for all remaining Albpetrol active well production and also the expansion of the project area and development plan to include all of the contract area of the Patos-Marinza oilfield concession.