Isab, quattro nodi da sciogliere per Ludoil

August has cleared the field of the two primary regulation points for Isab's control change. On August 4th, the Antitrust decided not to initiate an investigation into Ludoil's acquisition of 51%, deeming the operation not significant enough to hinder competition. The following day, August 5th, brought the free pass with the Golden Power commission's prescriptions.

Now the game shifts from regulatory to industrial ground, with considerable stakes for the entire national energy system. The Priolo complex is the largest refining hub in Italy, capable of operating around 320,000 barrels daily, equivalent to nearly 19% of national capacity, featuring a 532 MW IGCC plant for electricity generation.

Over a thousand people work directly in the three production sites. In terms of size, employment, and national energy autonomy contribution, Isab is deemed a strategic national infrastructure. The first step will be closing the 51% stake, which will grant Ludoil control over Isab. Thereafter, four nodes will open. The first is already hinted at in the Antitrust's decree: the relationship with Trafigura.

Isab is tied to the international trading group until 2033 through an exclusive Master Supply and Offtake Agreement. Trafigura supplies crude and other raw materials and buys back around 90% of the refined products, while third-party sales are limited to the remaining 10%. The Agency notes that even without the contract, Isab would still need a crude supplier not found within Ludoil's group, which primarily operates downstream the supply chain.

The resolution of this agreement's early termination would have significant economic consequences for Isab. The second point revolves around investments. Ludoil aims to transform Isab into a multi-energy platform, developing HVO, SAF, bio-oil, and advanced biofuels. The refinery has already started co-processing, with a regime objective of 500,000 tons annually.

However, capex, timelines, affected plants, and funding sources remain to be determined. The third node concerns financial aspects. For Ludoil, entering Isab represents a substantial dimensional leap. Neither the acquisition price nor the operation's financial structure has been publicly disclosed: the challenge lies in sustaining the purchase and industrial transformation together.

Lastly, there's the 49% held by Goi Energy. The 51% already grants Ludoil control over Isab, but the agreement foresees a second phase through put and call options on the remaining share.