Four out of seven members of the Mazeikiu Nafta board, representing Russia's now bankrupt Yukos Oil Company [RTS: YUKO], said last Saturday they did not trust the current director, Paul Nelson English. The matter will be put to vote Sunday, and then Mazeikiu's supervisory board of six Yukos representatives and three Lithuanian government people will have to approve the decision.
PKN Orlen, the largest oil refiner in Poland and central Europe, signed an agreement in May to buy 53.7% in Mazeikiu from Yukos for $1.49 billion, and the Lithuanian government offered another 30.66% for $852 million. PKN Orlen is eventually seeking 100% ownership in the Lithuanian company.
The deal is to be completed by March 2007 but the Polish company suspended the procedures after a fire broke out at the refinery in mid-October, causing millions of dollars worth of damage and jeopardizing the deal.
Lithuanian Lietuvos Rytas newspaper said Yukos's representatives in the Mazeikiu board accused current director, English, of secretly negotiating with PKN Orlen managers, who "are not interested in the company [Mazeikiu] operating at full capacity now, as it would raise its value."
English has denied all allegations and said he had no intention of resigning his duties, and was backed by PKN Orlen last week.
Since the pipeline accident, Russia has refused to resume oil flows to Mazeikiu Nafta, which has been widely viewed as a response to the Lithuanian government's decision to sell the Baltic refinery complex to a Polish firm, rejecting rival bids from Russian crude producers.
