MOSCOW (Dow Jones)
Russian oil company OAO Lukoil Holdings (LKOH.RS) is considering an offer from U.S. major ConocoPhillips (COP) for Lukoil to buy shares in a Conoco oil refinery in Germany and help modernize the plant, a Lukoil spokesman said Tuesday.
The spokesman declined to name the refinery or to say how much could be spent on the project.
"We're looking at the possibility of modernizing a refinery in Germany as a joint project" (with Conoco), the spokesman, Dmitry Dolgov, said. "We could also purchase shares in this refinery."
Dolgov said the proposal had come from Conoco and was currently being evaluated by Lukoil.
A Conoco spokesman in Houston declined to comment.
Conoco is Lukoil's strategic partner and owns 20% of the Russian company.
Conoco owns one refinery in Wilhelmshaven, Germany, and an 18.75% stake in the Mineraloel Raffinerie Oberrhein GmbH (MiRO) refinery in Karlsruhe.
Lukoil has sought unsuccessfully for months to establish a refining base in Europe, its main export market.
Valery Golovushkin, Lukoil's vice president for trading and supply, complained earlier this month that high oil prices have boosted the price of assets in the oil sector around the globe and were hindering Lukoil's acquisition plans.
He said Lukoil had been in talks with Royal Dutch Shell PLC (RDSB.LN) over possible sales of the U.K. oil major's French refining assets, but that the talks might fall through due to the high asking price.
Lukoil attempted to buy Kuwait Petroleum International's oil refinery in Rotterdam last year, but was thwarted when the Kuwaiti company decided against selling the plant.
Lukoil shares closed on Moscow's RTS 1.6% lower at $84.10. At 10:03 a.m. EDT, Conoco shares were trading 1.1% lower at $67.44.
Copyright (c) 2007 Dow Jones & Company, Inc.