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Monday, March 27, 2017

VTB says Odessa refinery deal complies with Ukrainian law

Russia's VTB Bank said on Tuesday that a Ukrainian company's agreement to pledge an oil refinery in Odessa as collateral for a loan is fully compliant with Ukrainian legislation.

Russian newspaper Kommersant said in March that Vetek, the refinery's previous owner, transferred the plant to VTB after failing to repay the loan it had taken out to buy the plant from Lukoil last year, Reuters reports.

"In effect, what some Ukrainian representatives are proposing is the expropriation of collateral belonging to the bank," VTB said. "Such unlawful actions could push Russia into a response that would be harmful to trade and economic relations between the two countries. Responsibility in this case would lie wholly on the Ukrainian side."

Arsen Avakov, the interior minister of Ukraine, said the interim government wants to return control of the Odessa oil refinery to Kiev.

Vetek is owned by Ukrainian tycoon Serhiy Kurchenko who earned his fortune under the presidency of ousted leader Viktor Yanukovych. Ukraine's prosecutor general issued an warrant for Kurchenko's arrest in March on the grounds of stealing state property.

Avakov said the police seized thousands of tons of refined oil products belonging to Kurchenko's companies. Kurchenko left Ukraine in February, Reuters reports.