Lukoil and RussNeft Exchange Assets

According to Mikhail Gutseriev, Lukoil offered RussNeft to choose between some of its assets to be exchanged for its stake at Geoilbent. Earlier Lukoil President Leonid Fedun said that the company was choosing an asset valuer.  Neither RussNeft nor Lukoil specify what particular assets have been offered to the company of Mikhail Gutseriev.
Geoilbent OOO develops Severo-Gubkinskoye, Prisklonovoye and Yuzhno-Tarasovskoye oil and gas condensate fields conducting exploration at Urabor-Yakhinskoye and  Vansko-Namysskoye license plots in Yamal-Netetsk AO. The proved oil reserves at these oilfields amount to 70 million tons. In 2004 Geoilbent produced 1 million tons of crude oil, and in 2005 – nearly 1.2 million tons. A 66% stake of Geoilbent is possessed by Lukoil, and 34% stake – by RussNeft via its Cyprian Broadwood Trading & Investments Ltd (BTI).
According to Ъ, RussNeft is going to choose out of five or six assets offered by Lukoil in the Volgograd and Perm regions as well as in the Republic of Komi. As a result, the stake of RussNeft at Geoilbent can be exchanged not for one but for two assets whose total oil production will amount to 450-500 million tons of crude oil a year. The regions have been chosen basing on their proximity to the existing producers of RussNeft.
Lukoil may offer the following assets to RussNeft for exchange – Bitran OAO in Komi with 500 thousand tons of oil a year, Aksaitovneft in the Perm region with nearly 100 thousand tons, PermTOTIneft with about 150 thousand tons, SP Volgodeminoil OOO in the Volgograd region with 400 million tons.
This is to remind that before the middle of 2005 the 66% stake at Geoilbent was held by Novatech, and the 34% stake – by Yukos Operation Holding. On June 6 Novatech officially informed about the sale of its share at Geoilbent to Lukoil-Western Siberia affiliated with Lukoil OOO. However claims for the assets were unexpectedly made by BTI that alleged holding the 34% stake at Geoilbent and having the pre-emption right to buy out the share of Novatech at the company. It was later discovered that Yukos had sold the Yukos Operational Holding to RussNeft and it was renamed BTI. BTI didn’t hamper the progress of the deal between Novatech and Lukoil. As a security action on the claims of BTI and physical bodies, various local courts of southern regions of Russia began disallow the sale of Geoilbent stakes. Only in July the court actions were withdrawn and the deal between Lukoil and Novatech was finalized.
Lukoil didn’t, however, wish to share Geoilbent with another proprietor and started to talk about buying out or exchanging RussNeft’s stake at the company. It is important to note that RussNeft insists on exchanging its stake at Geoilbent for Lukoil producing assets, whereas at Lukoil they assume that the subject of the negotiations with RussNeft is whether to exchange assets or just simply to buy out from RussNeft its stake at Geobentoil. According to Ъ, the parties are going to make a decision before the end of 2006.
Ъ will follow the progress of the deal.
Anna Ъ-Skornyakova,
Irog Ъ-Swiriz,
Volgograd