Finance ministry rings changes at top of strategic oil pipeline company

09-01-2015

One of the management veterans at the top of a Czech state company has finally been pushed out. Jaroslav Pantůček’s exit from oil pipeline company MERO is a clear signal that finance minister Andrej Babiš wants to make a fresh push to attain some of his goals for the fuels and refinery sector.

Jaroslav Pantůček, photo: Zuzana SuchánkováJaroslav Pantůček, photo: Zuzana Suchánková One of the longest lasting heads of a state-controlled company has been given his marching orders after around a decade in the post. Head of the Czech oil pipeline company MERO, Jaroslav Pantůček, which is 100 percent owned by the state, was replaced as general manager and board chairman at a meeting of the supervisory board on Wednesday.

Along with Pantůček, two other of the company’s top management were also forced to step down; the director of strategic management, Libor Lukášek, and financial director Vlastimil Boura.

Two new managers have already been named, Stanislav Bruna and Otakar Krejsa, who had been brought onto the supervisory board around six months ago to get a hold on the day to day running of the business.

They have been tasked with improving company results, sealing better relations with key customers, and charting out long term plans for the pipeline company in a fast changing European and Czech refinery context, according to a short statement from the Ministry of Finance.

Pantůček’s fall is hardly a surprise. Czech media had been reporting for some time that Minister of Finance Andrej Babiš has been looking to ease him out of the post for several months. When Pantůček refused to step down of his own accord, he was finally pushed.

But the state strategy, or more particularly Andrej Babiš’ plans, for MERO are more difficult to fathom. The Czech state has a few refinery assets, namely MERO and fuels distributor, petrol pump, and storage company ČEPRO, but the strategic high ground is held by Polish refinery group PKN Orlen, which runs the Czech Republic’s two main refineries at Litvínov and Kralupy through ownership of Česká Rafinérská.

Babiš suggested a few months ago that the Czech state might try to acquire the Kralupy refinery but PKN Orlen rebutted the suggestion saying it is not winning to sell. Along the same lines, the Czech finance minister has suggested the state win some sort of long term agreement from PKN Orlen about the utilization of the two refineries. That idea has apparently not advanced much either and the failure to conclude some sort of general deal with the Poles probably contributed to Pantůček’s demise.

PKN Orlen clearly have their own wish list from the Czech state. While the Czech government complains about the lack of refinery investments and utilization in the country, PKN Orlen says it would like a better deal on the charges offered to it by state companies MERO and ČEPRO. Coincidentally, the new bosses at MERO, Stanislav Bruna and Otakar Krejsa, were both previously employed by PKN dominated Czech holding Unipetrol and were responsible for refinery operations and trading.

So, the latest musical chairs can probably interpreted as a sign that Babiš is pushing again for tangible progress on the shake-up and reorganization of the Czech refinery sector. Pantůček, who had recently put the finishing touches to an oil pipeline operator grouping aiming to safeguard operation of the main east-west oil pipeline Druzba which passes through the Czech Republic, appears to have been the fall guy for the fact that Babiš had nothing to boast about here after his first year in office.

09-01-2015