FOREIGNERS BARRED FROM BIDDING FOR RUSSIA'S BEST OILFIELDS ...........
MOSCOW, February 11. (RIA Novosti)-The Russian Natural Resources Ministry's liberal policy is not really that liberal. Natural Resources Minister Yury Trutnev announced on Thursday that neither foreign companies nor Russian businesses controlled from offshore areas would be admitted to auctions for Russia's best oil and gas fields. Izvestia and Kommersant take up this matter.
What is behind this move? The fields are strategically important, so only companies with no less than 51% of Russian capital will be allowed to bid. The fields in question are Sakhalin-3 (over 600 million tons of crude) and several sites in the Barents Sea (more than 977 million tons) and the Yamal-Nenets Autonomous Area and the Timan-Pechora oil basin (aggregate resources of at least 250 million tons).
In all, more than 250 licenses are on the 2005 sales list, and the "Russians-only" short list includes the Udokanskoye copper deposit and the Sukhoi Log gold field. The latter's reserves are estimated at over 1,000 tons of gold, which puts the minimum starting price at $150 million.
The Natural Resources Ministry has put many major companies on a black list. One is Sibneft, whose controlling stake belongs to six Cyprus-based offshore companies managed by Millhouse Capital. Another is TNK-BP, a 50/50 joint venture between Russia's Alfa Group and Access/Renova and Britain's BP. The ministry acknowledges that Surgutneftegaz and Norilsk Nickel might also be in a difficult situation.
Given the ministry's latest moves, such international players as Shell, Total, CNPC, Chevron, and ExxonMobil have few prospects for expanding their business in Russia. The only hope for them is to set up Russian subsidiaries, which is not something every company can afford.
Non-Russian companies were shocked by Mr. Trutnev's statement. Shell Russia press secretary Maksim Shub said he did not understand what was going on. Other companies refused to comment. |
