Rosneft challenges Total in Siberia project
Moscow |Reuters | 05-04-2003
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Rosneft, Russia's state-owned oil company, threatened to block TotalFinaElf SA's plan for a $2.5 billion oil development in the Siberian permafrost by lodging a competing offer for rights to the project.
Chairman Sergei Bogdanchikov offered to buy Anglo Siberian Oil Co, which owns 59 per cent of the Vankor field, a deposit that ranks among 10 largest untapped reserves onshore in Russia. TotalFinaElf of France, Europe's third-biggest oil company, last year agreed to buy control of the Arctic field from Anglo Siberian, a deal that has yet to close.
Russia's state oil firm Rosneft said it had made a generous cash bid for the shares of Anglo Siberian Oil, offering to pay $72 million for the oil firm with important reserves in Western Siberia. The offer is 64 per cent more than Anglo's price. Owning Anglo Siberian is key to gaining the right to spend money on the field.
"This is a fight for promising oil reserves between Russian and foreign companies," said Valery Nesterov, an analyst at Moscow-based Troika Dialog brokerage.
"So far, Western companies are losing this fight." Oil companies such as BP Plc and TotalFinaElf are increasingly looking at Russian fields as an alternative to projects in the Middle East, where the attacks of September 11 and war with Iraq have delayed developments.
Russia is the world's second- largest oil exporter, lagging only Saudi Arabia. Royal Dutch Shell/Group, the UK's Sibir Energy Plc and Yukos Oil Co. have also been interested in Vankor, which has 906 million barrels of recoverable reserves and no links to world markets.
The field lies 500 kilometres from the state-owned pipeline network and 700 kilometers away from a possible oil port on the Kara Sea.
Anglo Siberian shares rose as much as 34.5 pence, or 57 per cent, to 95.5p and were at that level at 12:41 p.m. in London.
"These counter-bids may result in a partnership, as Rosneft may help to secure a production-sharing agreement for the field" to provide tax breaks to investors, said Leonid Mirzoyan, a Deutsche Bank analyst in Moscow. "The situation is very untypical when a state-owned company bids for Western-owned assets."
A Rosneft adviser said the company's offer is conditional on the TotalFinaElf accord falling through.
Total spokesman Floren declined to comment. Rosneft has received letters of intent for support from shareholders holding about 41.1 per cent of Anglo Siberian, the Russian company said. "This proposed acquisition is in line with our strategy of building a quality reserve base" in the former Soviet Union, Bogdanchikov said in a statement.
"We are well positioned to exploit fully the value of Anglo Siberian's asset base in Russia."
Yukos, Russia's second-largest oil producer, held through its affiliated companies a stake in Yeniseyneft, which is 59 per cent owned by Anglo, said Yukos Deputy Chief Executive Yuri Beilin last year.
Yeniseyneft owns the license to the field. Last year Yukos was in talks with BP over selling some oil assets owned by Yukos's East Siberia-based exploration company, which also held stakes in the Vankor field, Yukos said then.
Yukos has been fighting to return control over its stake in Yeniseyneft after part of it was sold by companies affiliated with Yukos, according to Beilin.
Total is facing difficulties in completing its transaction because some shareholders are blocking its approval, Vedomosti reported, citing Francois Rafin, the company's director of Russian operations, in February.
It might have happened as Rosneft recently bought a 13 per cent stake in Yeniseyneft, the paper said.
· Oil slumps on Iraq war optimism
· Petrol Ofisi offers fuel to U.S. forces
· U.S. cash crude prices fall
· Oman crude under pressure
· Rosneft challenges Total in Siberia project
· Oil Briefs - April 5, 2003
Moscow |Reuters | 05-04-2003
Print friendly format | Email to Friend
Rosneft, Russia's state-owned oil company, threatened to block TotalFinaElf SA's plan for a $2.5 billion oil development in the Siberian permafrost by lodging a competing offer for rights to the project.
Chairman Sergei Bogdanchikov offered to buy Anglo Siberian Oil Co, which owns 59 per cent of the Vankor field, a deposit that ranks among 10 largest untapped reserves onshore in Russia. TotalFinaElf of France, Europe's third-biggest oil company, last year agreed to buy control of the Arctic field from Anglo Siberian, a deal that has yet to close.
Russia's state oil firm Rosneft said it had made a generous cash bid for the shares of Anglo Siberian Oil, offering to pay $72 million for the oil firm with important reserves in Western Siberia. The offer is 64 per cent more than Anglo's price. Owning Anglo Siberian is key to gaining the right to spend money on the field.
"This is a fight for promising oil reserves between Russian and foreign companies," said Valery Nesterov, an analyst at Moscow-based Troika Dialog brokerage.
"So far, Western companies are losing this fight." Oil companies such as BP Plc and TotalFinaElf are increasingly looking at Russian fields as an alternative to projects in the Middle East, where the attacks of September 11 and war with Iraq have delayed developments.
Russia is the world's second- largest oil exporter, lagging only Saudi Arabia. Royal Dutch Shell/Group, the UK's Sibir Energy Plc and Yukos Oil Co. have also been interested in Vankor, which has 906 million barrels of recoverable reserves and no links to world markets.
The field lies 500 kilometres from the state-owned pipeline network and 700 kilometers away from a possible oil port on the Kara Sea.
Anglo Siberian shares rose as much as 34.5 pence, or 57 per cent, to 95.5p and were at that level at 12:41 p.m. in London.
"These counter-bids may result in a partnership, as Rosneft may help to secure a production-sharing agreement for the field" to provide tax breaks to investors, said Leonid Mirzoyan, a Deutsche Bank analyst in Moscow. "The situation is very untypical when a state-owned company bids for Western-owned assets."
A Rosneft adviser said the company's offer is conditional on the TotalFinaElf accord falling through.
Total spokesman Floren declined to comment. Rosneft has received letters of intent for support from shareholders holding about 41.1 per cent of Anglo Siberian, the Russian company said. "This proposed acquisition is in line with our strategy of building a quality reserve base" in the former Soviet Union, Bogdanchikov said in a statement.
"We are well positioned to exploit fully the value of Anglo Siberian's asset base in Russia."
Yukos, Russia's second-largest oil producer, held through its affiliated companies a stake in Yeniseyneft, which is 59 per cent owned by Anglo, said Yukos Deputy Chief Executive Yuri Beilin last year.
Yeniseyneft owns the license to the field. Last year Yukos was in talks with BP over selling some oil assets owned by Yukos's East Siberia-based exploration company, which also held stakes in the Vankor field, Yukos said then.
Yukos has been fighting to return control over its stake in Yeniseyneft after part of it was sold by companies affiliated with Yukos, according to Beilin.
Total is facing difficulties in completing its transaction because some shareholders are blocking its approval, Vedomosti reported, citing Francois Rafin, the company's director of Russian operations, in February.
It might have happened as Rosneft recently bought a 13 per cent stake in Yeniseyneft, the paper said.
· Oil slumps on Iraq war optimism
· Petrol Ofisi offers fuel to U.S. forces
· U.S. cash crude prices fall
· Oman crude under pressure
· Rosneft challenges Total in Siberia project
· Oil Briefs - April 5, 2003
