site.btaUPDATED Justice Minister: Authorities Received Early Warning on Bank Payment Suspension for Lukoil Payments, Moved to Prevent Crisis

A warning was received about the suspension of payments by "certain Bulgarian banks", as well as all bank card transactions involving entities linked to sanctioned entities such as Lukoil—not from November 21, but earlier, within the coming week, Justice Minister Georgi Georgiev said here Friday. He was speaking during a news briefing at the Council of Ministers, following a meeting of the Security Council convened by the Prime Minister regarding the situation with Lukoil.

“This required swift, decisive, and urgent measures, which we took at the earliest opportunity,” Georgiev said. He added that, beginning this very day, the government has the authority under the new powers granted to the special representative, to take action.

Georgiev emphasized that all measures taken so far have been coordinated with the government’s international partners. "The government expects to receive, in the very short term, the outcome anticipated by Bulgarian society: a one-time license allowing Lukoil operations to continue in Bulgaria, provided the Bulgarian State ensures effective application of the German model of asset management and control, preventing payments from reaching shareholders or sanctioned individuals for financing the war," said the Minister.

Prime Minister Rosen Zhelyazkov convened the Security Council to discuss the appointment of a special administrator for Lukoil.

He stressed that since the US government imposed sanctions, the Bulgarian government—through himself and Energy Minister Zhecho Stankov—has been in constant communication with the Office of Foreign Assets Control (OFAC) and the relevant UK authorities, which have also imposed sanctions. "During this period, we preferred to ‘be masters of silence rather than slaves to words,’ sharing only what was necessary to safeguard ongoing dialogue, which has been intensive and daily," Georgiev explained. He added that their most recent meeting with US partners took place online last night.

Georgiev noted that a law passed by Parliament a week ago only came into effect November 14, delaying preparations for measures intended to achieve the objectives of the sanctions by another week. According to him, the purpose of the sanctions is to ensure that countries hosting refineries like Lukoil’s implement legislation to prevent revenues from these companies from funding the war or reaching sanctioned individuals.

When asked if Bulgaria is ready for potential unauthorized actions by Lukoil’s owners, Georgiev said that halting the refinery or aviation fuel deliveries to hundreds of gas stations would pose an extreme risk to national security. "Actions have been taken from day one," he said. He added that the Economy Minister leads a specialized group, with representatives from all relevant agencies reporting daily on measures being implemented. Georgiev noted that police teams and drone-equipped security are stationed daily at the refinery to prevent provocations.

Asked whether the US sanctions derogation could take effect within the day, Georgiev said he could not provide a precise timeline but expects it to happen soon. "We have assurances that the measures we have implemented and communicated, in line with the goals of the sanctions and the interests of Bulgarian society, are adequate. We are awaiting responses from our American and British partners, especially given our ongoing payment issues," he added.

The UK last month announced sanctions on Russia's two biggest oil companies, Rosneft and Lukoil, and a week later the US followed suit in a bid to squeeze the financing of Moscow's war effort in Ukraine, Reuters reported.

On Friday, Britain announced a temporary break from sanctions that will allow Bulgaria's Lukoil Neftochim refinery in Burgas - the country's biggest refinery - and Lukoil petrol stations to continue doing business with UK companies and banks.

A source close to the US Treasury's Office of Foreign Assets Control told Reuters that the US is expected to issue a similar licence regarding the Bulgarian entities later on Friday.