Brandenburg’s Prime Minister Woidke Calls for Reliable Ownership Structure

Brandenburg’s Prime Minister Woidke Calls for Reliable Ownership Structure

The Prime Minister of Brandenburg, Dietmar Woidke (of the Social Democratic Party – SPD) has voiced his concerns regarding a potential expropriation of the Russian Rosneft Group. The Rosneft Group holds the majority ownership of the Schwedt oil refinery. Responding to a query on the issue, Woidke stated: “The PCK (a German oil company) requires a dependable and long-term ownership structure. This is critical to ensure smooth operations, safeguard jobs and provide a steady supply of crude oil products from PCK Schwedt in Brandenburg.” He added that the federal government must ensure this without undermining previous accomplishments.

The Russian Rosneft Group owns approximately 54 percent of the shares in the PCK refinery. This ownership is exercised through two of its subsidiaries and has been under trust management, effectively under federal state control, since the autumn of 2022. Recently, it has come to light that the federal government is contemplating the expropriation of Rosneft’s shares. However, a concrete decision in this regard is yet to be made. Jörg Steinbach, Brandenburg’s Economics Minister (also from the SPD), has declined to comment on this matter so far.

On a related note, it was suggested that there was a discussion on Thursday at the State Chancellery about possible expropriation. A government spokesperson mentioned that confidential discussions among the concerned parties were a regular occurrence. However, he refused to comment on the specifics of these discussions. Meanwhile, the Kremlin in Moscow announced on Thursday that Rosneft would fight against any expropriation, using every legal recourse available.

Shell’s Plans to Sell its Shares

The future ownership structure of the refinery, devoid of Russian influence, is still unclear. There are ongoing deliberations about a new shareholder. The energy behemoth, Shell, revealed in December that it intends to sell its 37.5 percent stake in the refinery to the British Prax Group. Eni Germany also has a stake in the refinery.

The refinery, located in the Uckermark region, is a major supplier of fuel to large parts of northeastern Germany. Until the end of 2022, it processed crude oil from Russia. However, in light of the sanctions imposed on Russia due to its aggressive actions against Ukraine, the federal government decided to cease the use of Russian oil. As a substitute, crude oil has been imported to Schwedt via Gdansk and Rostock, as well as from Kazakhstan, since 2023.

In response to the evolving situation, Woidke established a task force to plan for the refinery’s future. This task force, which includes representatives from the federal government and the company, was set in motion at the end of 2022. In January, it was reported that the refinery’s utilization capacity remained stable around 80 percent.