Lukoil signs deal with Carlyle to sell international assets amid sanctions pressure

Russian energy giant Lukoil has announced the signing of an agreement with the US investment firm Carlyle for the sale of LUKOIL International GmbH, a wholly-owned subsidiary that holds the group’s international assets.

In a statement released by the company, Lukoil emphasized that the sale process remains subject to specific regulatory approvals.

Kazakhstan assets to remain under group ownership

According to reports from the Interfax agency, Lukoil clarified that its strategic assets in Central Asia are not included in the sale process.

“The scope of this transaction does not include assets in the Republic of Kazakhstan, which will remain under the ownership of the Lukoil group and continue operations under their respective licenses,” the company stated.

The firm noted that the signed agreement with Carlyle is non-exclusive and that the completion of the process depends on the fulfillment of several clinical preconditions. Among these conditions is obtaining the necessary authorization for the transaction with Carlyle from the US Treasury Department’s Office of Foreign Assets Control (OFAC). Lukoil confirmed that discussions with other potential buyers are ongoing.

The decision to sell LUKOIL International GmbH follows sanctions imposed on Lukoil and its subsidiaries by several nations. The US Treasury Department placed Lukoil on its sanctions list on October 22, 2025.

Taking into account the potential for the company to sell its foreign assets to non-sanctioned entities, OFAC issued a license valid until December 13. This license was subsequently extended first to January 17, and then to January 28, 2026. This authorization covers the negotiation of final agreement terms, financial and legal due diligence, and the involvement of third-party advisors in the process.

“No approval as long as the conflict continues”

Lukoil initially announced its intention to divest its international assets following sanctions decisions by the US and the UK (October 15).

During this period, the international commodity trading firm Gunvor submitted a bid to acquire Lukoil’s foreign assets, and the parties reached an agreement on basic terms. However, the transaction could not be completed after the US Treasury Department announced it would not grant a commercial activity license to Gunvor as long as the conflict in Ukraine persists. Following this development, the buyer withdrew its offer.

After Gunvor’s exit from the process, numerous buyers emerged for LUKOIL International. According to media reports, interested parties include US energy giants Chevron Corp. and ExxonMobil, the Abu Dhabi state-owned company ADNOC, the United Arab Emirates-based International Holding Company (IHC), Saudi Arabia-based Midad Energy, and Austrian businessman Bernd Bergmair. Additionally, US businessman Todd Boehly is reportedly monitoring the process alongside a group of UAE investors.

Production and reserve data

Lukoil currently operates projects in Azerbaijan, Kazakhstan, Uzbekistan, Iraq, Egypt, Cameroon, Nigeria, Ghana, Mexico, the United Arab Emirates, and the Republic of the Congo. The company’s portfolio includes refineries in Bulgaria, Romania, and the Netherlands, as well as a fuel distribution network of approximately 2,500 stations across 19 countries.

According to company data, Lukoil’s proven oil and gas reserves in international projects stood at 1.345 billion barrels of oil equivalent at the end of 2024.

Excluding the West Qurna-2 project, oil production from international projects—including gas condensate—reached 3.9 million tons in 2024, while natural gas production was 16.2 billion cubic meters. The processing volume at the group’s European refineries fell by 18% year-on-year to 13.5 million tons, primarily due to the sale of the ISAB refinery in Italy in May 2023. International retail sales of petroleum products were recorded at 4.2 million tons in 2024.

Exemptions for specific projects from Western nations

The UK government has permitted transactions involving Lukoil’s international assets until February 26. Meanwhile, OFAC has extended the authorization for the operations of the Russian company’s foreign gas stations until April 29, 2026.

Certain international projects held by the company have been granted exemptions from both UK and US sanctions. These include projects to develop the Tengiz and Karachaganak fields, as well as the Caspian Pipeline Consortium (CPC).

Analysts estimate the value of Lukoil’s international business at between €14 billion and €21 billion. However, it remains unclear whether the stakes in projects exempted from sanctions are included in this valuation. Separately, the government of Kazakhstan has formally applied to OFAC regarding the potential buyback of Lukoil’s shares in joint projects.