Lukoil and Petrol Form Monopoly for Fuel Deliveries to Government

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The supply of gasoline for cars to ministries, the dozens of subordinate to them agencies, committees, and so on and so forth is undoubtedly in the dreams of every fuel dealer in the country. So these contracts always touch on huge large interests. Moreover, even after the conclusion of contracts intrigues and fights between players continue and losers, as always, are the taxpayers. Quite expectedly in such a scenario was involved the mega procedure for BGN60 million of the Central Authority for Public Procurement, which in the spring of 2011 announced Petrol and Lukoil for winners.

In the course of the contest we had been shown a lesson how to make a contest with a preliminary known winner. Then, after application of the BANKER under the Access to Public Information, the general public understood that during the selection committee during their review, evaluation and ranking of bids made a bunch of violations and improperly stated as winner Petrol. The scandal erupted and a second tender did not change anything. Six months later there are a dozen of contracts, but it is difficult to speak of serious competition between companies, since almost all orders have been given back to the original favourite.

The first contract under the framework agreement with Oil and Lukoil was signed on 22 June. Back then the Ministry of Finance gave BGN198 thousand to Lukoil to supply gasoline and diesel for the official fleet of the Ministry. Otherwise, the authority estimated that during the period of the contract (18 months) it would need 30 thousand liters of diesel and 54 thousand liters of gasoline (A- 95H and A-98N). This makes an average price of BGN2.36 per liter

against current prices of BGN2.41 and a discount of at least 5 cents per liter (editor’s note: – which any driver can get) is a relatively good price.

Two weeks later the Ministry of Foreign Affairs selects Petrol for the same purpose, this time the amount paid for the fuel is a bit more than BGN200 thousand. In all likelihood, however, our diplomats will order additional quantities, as projections by the end of 2012 are that they will need 300 thousand liters gasoline and 50 thousand liters of diesel, for which estimated costs are about BGN650 thousand.

The next contract is from 21 July, when the Ministry of Regional Development and Public Works of the same company pays BGN350 thousand for fuel. The situation here is the opposite to that at the Foreign Office. The amount announced in the tender was at least two-fold smaller – about BGN140 thousand, but obviously due to the great number of projects for construction of the Ministry its travel experts have increased their trips dramatically

What quantities of fuels, however, have been purchased with the money, it is not clear.

After a few days later the Sports Ministry ordered their cards for cashless payment at loading stations of Petrol with the difference that they were much more modest – just for BGN99 thousand for 17 months.

Other ministries placed huge orders for supplies of fuel to both Lukoil and Petrol . Many of them amount to tens of millions of Bulgarian levs and there is no evidence the state prefers either company.

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