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Varo Energy in talks to purchase Preem's Swedish refineries, sources say

European energy company Varo Energy is in speak with obtain Preem's two Swedish refineries in a bet on growing need for lowcarbon biofuels, 4 market sources told Reuters.

Varo has been broadening quick in Europe's refining and fuel trading recently. The company is backed by private equity giant Carlyle Group and the world's most significant trading house Vitol, which has actually enjoyed record revenues recently.

Varo could purchase the Gothenburg and Lysekil plants from Corral Petroleum Holdings, which owns Preem, the sources stated.

A Varo representative decreased to comment. Preem decreased to comment.

The sources stated the value of the possible deal wasn't clear as the downturn in Europe's refining margins has actually made transactions more complicated, one of the sources said.

Preem's adjusted earnings fell 15% to $1 billion in the initially 9 months of 2024, however plunged 94% to $28 million in the 3rd quarter alone.

Varo currently has stakes in refineries in Germany and Switzerland and is broadening in sustainable fuel and trading. It plans to invest around $3.5 billion in between 2022 and 2026, with two-thirds dedicated to sustainable energies.

Preem intends to increase production of sustainable fuels to 5 million cubic metres by 2035, the company has actually stated. It likewise has a network of over 500 gas stations in Sweden.

(source: Reuters)