Ukraine Deputy PM Says Kremenchug Head Illegal

KIEV, Ukraine -- The current management of Ukraine's largest refiner, Kremenchug, acted illegally last week when it ousted the head of the company running the plant and took over, a deputy prime minister said on Wednesday.

Kremenchug refiner

Russian company Tatneft cut oil supplies to Kremenchug after a former manager of Ukrtatnafta, Pavel Ovcharenko, used armed police to expel the head of the company last Friday. The refinery is now running on reduced capacity.

"This was a raider's hit. A man who has not worked there for three years tried to capture the plant with an illegal court decision and return illegally to work," Deputy Prime Minister Andriy Klyuev, in charge of energy, told Reuters.

Ovcharenko had fought against his own dismissal in several courts for three years and said a Kremenchug court had finally ruled in August to reinstate him. He accuses the management he expelled of incurring debts of some $500 million.

The ousted company chief, Sergei Glushko, is appealing against the court decision, Ovcharenko's lawyer told Reuters.

Interfax Ukraine news agency reported on Wednesday that "unknown people in camouflage" had blocked Ukrtatnafta headquarters in Kremenchug and that Glushko had appeared at the scene.

Ukrtatnafta was not available for comment.


Tatneft, Kremenchug's chief supplier, has said it wants the management situation clarified before resuming deliveries.

A Kremenchug official said on Wednesday the refinery had bought 170,390 tonnes of oil for October-November. Ovcharenko said on Tuesday it had enough stocks to run for 12 days on reduced capacity.

The official did not say how much Kremenchug paid for the oil. Local media reported that the average price at an auction on Tuesday jumped 10 percent to 3,012 hryvnias per tonne against the last auction a month ago.

Tatneft, controlled by Tatarstan, owns 8.6 percent of Ukrtatnafta, while the Russian republic itself owns a further 28.8 percent. Ukrainian state energy firm Naftogas owns another 43.1 percent, while two western companies own the rest.

Tatneft has accused Ukraine of diluting its stake in Ukrtatnafta, while Ukrainian officials have questioned the way the refiner was sold. Tatneft backed Glushko as the legitimate head, via a statement on the Tatarstan government Web site.

Russia and Ukraine have had repeated disputes over energy supplies in recent years. These included a halt in Russian gas supplies in January 2006, which led to disruptions in gas deliveries to Europe via Ukraine.

The government of Prime Minister Viktor Yanukovich, who has had good relations with Moscow over energy issues, is likely to be replaced after ex-premier Yulia Tymoshenko and her allies gained a slim majority in parliamentary elections on Sept. 30.

Tymoshenko was appointed premier by President Viktor Yushchenko, who defeated the Moscow-backed Yanukovich in the 2004 "Orange Revolution" that followed a rigged poll. Relations with Russia plunged during her eight-month tenure.

Source: Singapore News