Lukoil, Russia's largest oil company, has written to INA announcing that it is withdrawing from the due diligence process that is underway at the Croatian oil company. The news was confirmed by INA's press office.

Since the beginning of the due diligence process in August, Edison Gas has also pulled out and only Austria's OMV, Hungary's MOL and Russia's Rosneft remain in competition to be INA's strategic partner.

As the government announced that at least three companies had to be in the final selection round, the total privatisation could be doomed to failure. INA CEO Tomislav Dragicevic said months ago in an interview for Bank magazine that it was possible that OMV and MOL would put in a joint bid for the company.

Rumours are abounding that, if Rosneft won the competition, Croatian shipyards could find themselves building 200 ships for Russia's commercial fleet over the next ten years. This would see the shipyards working at full capacity after drinking billions of kunas in subsidies recently.

(NewsBase 30.ix.02)