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To: RealMuLan who wrote (21686)	1/18/2005 3:43:33 PM
From: RealMuLan	Respond to of 116555

China’s CNPC to Credit Russia’s Rosneft With $6Bln for Future Oil Deliveries Created: 18.01.2005 11:21 MSK (GMT +3), Updated: 12:20 MSK, 11 hours 20 minutes ago MosNews China National Petroleum Corporation (CNPC) may help Russia’s state-owned Rosneft Oil Company repay the loan that it took out in order to pay for the purchase of Yukos’ crown jewel, Yuganskneftegaz. According to the information provided by the Vedomosti business daily on Tuesday, Jan. 18, the Chinese are ready to credit Rosneft with $6 billion for future crude deliveries to China. The main production asset of the embattled Yukos Oil Company was sold at an auction on Dec. 19, 2004 for $9.35 billion. The auction was won by the unknown company Baikal Finance Group, which was 4 days later bought by state-owned Rosneft for 10,000 rubles ($350). Rosneft paid the full price of Yuganskneftegaz on Dec. 31, 2004 and formalized the new ownership rights on the same day. A manager from MDM-bank, where the court bailiffs’ accounts are, said the money for Yugansk was deposited to the bank at the end of December. However it is still unknown who lent Rosneft the necessary $9.35 billion. The top managers of Western banks claim that they provided no credits to Rosneft for fear of legal action by Yukos Oil Company. Analysts suggested that the state-owned company borrowed the money from a number of Russian banks. After acquiring Yuganskneftegaz Rosneft was given the opportunity to deliver oil to China in the place of Yukos. In 2003 Yukos delivered to China’s CNPC and Sinopec 3.5 million tons of oil that was produced by Yuganskneftegaz. The oil major planned to increase the volume of deliveries to 15 million tons in 2006. A source from the Russian Industry and Energy Ministry, quoted by the paper, said that at the beginning of January the Energy Minister Viktor Khristenko and Rosneft’s president Sergei Bogdanchikov visited Beijing to meet with Chinese officials and the top management of CNPC. The source claims that the results of this meeting were the drafts of inter-government agreements and a contract between Rosneft and CNPC for the deliveries of 48.4 million tons of oil between now and 2010. In return CNPC is to provide Rosneft with a medium-term credit worth $6 billion and guaranteed by the deliveries of crude oil. Officials at Rosneft, the Industry and Energy Ministry and the Russian office of CNPC declined to comment on the information. Meanwhile the deputy chairman of Yukos’ board Alexander Temerkov said that according to his information the $6 billion credit is the necessary condition of the contract for the delivery of Russian oil to China. If the deal goes through this credit will become the largest in modern Russian corporate history. This is precisely the sum that all Russian banks lent abroad in 2004. Rosneft may raise the money necessary to repay the loan by selling a stake in Yuganskneftegaz. A source, close to negotiations between Rosneft and CNPC, claims that the Russian side offered CNPC 20 percent of Yuganskneftegaz’s shares as a guarantee for the loan. The Chinese side, however, insisted on guaranteeing the loan with deliveries of oil. mosnews.com