Integration

Oil Company RussNeft is planning to establish a joint venture within one month and a half. The venture will be organized with an Algerian company and targeted at the implementation of joint projects in Algeria. The statement was made by RussNeft President Mikhail Gutseriev in Algiers at the press-conference reviewing the results of meeting of the Russian-Algerian Business Council. According to him, at present the Russian company is negotiating with concerned partners.
As M.Gutseriev pointed out, the joint venture will be created on a parity basis (50/50), and its project plans will be drawn up before the end of the year. RussNeft President also said that his company was going to take part in the tenders for Algerian oilfields to be conducted before the end of the current year. According to M.Gutseriev, the Algerian government has announced six tenders for oilfields. RussNeft will carefully study all the projects and will choose the most interesting ones.
RussNeft will try to get either one big oilfield or two smaller ones located close to each other.
Algeria is interested in Russian investments in the oil and gas sector of the country, said Co-Chairman of the Russian-Algerian Business Council on the part of Algeria Kamel Abdelrahim summarizing the results of the Council meeting.
“We see no reasons why we should bar Russian companies from this market,” said Mr. Abdelrahim. He pointed out that Russian companies could first of all collaborate in exploration and development of oil and gas field, as well as in feed transportation. The new legislation of the country on hydrocarbon feeds allows certain freedom in this industry. The more so since, Algeria is interested in Russian investments in oil and gas industry.
Mr. Abdelrahim also said that there were “other promising areas of cooperation” in Algeria.
Mr. Abdelrahim expressed hope that the membership of the Business Council would grow with each next meeting.
In her turn, Tatyana Gvilava, Director of the Russian-Arabian Council including 22 countries, said that the meeting of her Council would be held on September 4 in St. Petersburg. She also expressed the opinion that the next meeting of the Russian-Algerian Business Council might be dated for this time.  
Mr. Abdelrahim and Russian Co-Chairman of the Council Mikhail Gutseriev agreed with her proposal. The documents on establishing the Russian-Algerian Business Council were signed on March 9, 2006. But already now one can observe dynamic development of cooperation between our countries.

Our special correspondent
From our file:
Before the end of 2006 RussNeft is going to complete deals on acquisition of new assets in Azerbaijan, Kazakhstan and Mauritania. RussNeft intends to buy new oilfields in the areas of its operation traditionally found in Eastern and Western Siberia, and increase its oil production up to 25 million tons a year by the end of 2006 (currently RussNeft produces 17 million tons of crude oil). At that, the increase of oil production up to 20 million tons would be achieved on the basis of the existing assets of the company. This year RussNeft is going to invest $300 million in modernization and other actions to increase oil production at the operational oil fields of the company.
According to Russian accounting standards (RAS), in the first quarter of 2006 the net profit of RussNeft increased in 4.4 times as compared with the fourth quarter of 2005 and amounted to 3,635,813 thousand roubles.