13 March 2003 16:34
RUSSIA: SLAVNEFT MOVES FROM AUCTION BLOCK TO CHOPPING BLOCK
Sibneft and Tyumen Oil Company (TNK) shared their plans for divvying up Slavneft in a 5 March joint press release on
the companies' websites (http://www.tnk.ru, http://www.sibneft.ru/). The two companies together control 98.5
percent of Slavneft after acquiring a 74.95 percent stake for $1.86 billion at a December privatization auction.
According to the press release, Sibneft and TNK will split up Slavneft's production assets and sales network
equally, while continuing for the moment to share its two Russian and one Belarusian refineries. Sibneft will also sell
TNK its 38 percent stake in TNK subsidiaries Orenburgneft and Onaco for an undisclosed sum. "Kommersant"
reported on 6 March that TNK would pay "a maximum of $550 million," while "Vedomosti" reported the
same day that the figure could be as large as $800 million. It remains unclear how TNK's chunk of Slavneft will be
integrated into the company's February agreement with BP to combine the two companies' Russian assets. Stephen
O'Sullivan of United Financial Group told "The Moscow Times" on 6 March, "It will be an interesting
test case which will show how this new partnership works." The asset-division plan left some wanting more
information. Analyst Aleksandr Vertlyugin told "Finansovye izvestiya" on 6 March that the agreement "did
not really clear up the question of dividing assets between TNK and Sibneft." Analysts polled by
"Kommersant" agreed that "it's a long way to a final resolution." TNK and Sibneft are,
respectively, Russia's third- and fifth-largest oil companies. DK Copyright (c) 2003. RFE/RL, Inc. Reprinted with
the permission of Radio Free Europe/Radio Liberty
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