Rosneft's stake sale in Nayara hits EU sanctions roadblock

The proposed sale of Russian energy major Rosneft's 49.13 per cent stake in Nayara Energy, which operates India's largest single-location refinery at Gujarat's Vadinar, has hit a major roadblock following the European Union's (EU's) latest sanctions targeting Russia's oil sector.

- DEV CHATTERJEE

Rosneft is seeking to exit the Indian venture, with reports valuing Nayara at around $17 billion. Reliance Industries Ltd (RIL) is seen as the frontrunner to acquire the stake. However, the EU's additional curbs, announced last week in response to Russia's invasion of Ukraine, includes Nayara Energy among the entities targeted due to its Russian ownership.

Bankers familiar with the matter said the sanctions would hamper Nayara's ability to export refined products to European markets. "The Russian stake makes it difficult for global shipping companies and oil traders to engage with Nayara, especially in Europe, and will impact valuation," one banker said.