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Gazprom to buy Sibneftegaz stake and control of Beregovoye

28 Feb 2006 00:00:00

Russia’s Gazprom is to sign an agreement in March for a 51% stake in oil and gas company Sibneftegaz, currently owned by Itera, which holds a licence to develop the Beregovoye gas field in Russia’s Yamal Nenetsk region.

Florida-registered Itera, which several years ago was the biggest independent gas producer and trader in Russia, currently holds 79% in Sibneftegaz, while Russian ammonia and mineral fertilizer producer Akron holds the remaining 21%.

Should the deal go through, Gazprom would hold the majority stake in Sibneftegaz, while Itera will retain the remaining 49%, as Akron is said to be ready to sell its stake, according to the Russian daily Kommersant. Itera would not comment on the details of any agreement on Sibneftegaz to EGM but it did confirm that agreement had been reached to allow gas from Beregovoye into the Gazprom pipeline system. Beregovoye was ready for commissioning in 2003 but the field never began commercial production because of Gazprom’s unwillingness to allow access to the trunkline leading from Zapolyarnoye and running relatively close to Beregovoye. The reason always given by Gazprom was that it had no free capacity in the line.

The Beregovoye deposit contains 324 billion cubic metres of gas (Gm3), 9 million tonnes of oil and 1 million tonnes of gas condensate. Itera told EGM Beregovoye could produce up to 9 Gm3 in the first year and would peak at 12 Gm3/yr.

Over the years Florida-registered Itera’s gas activities in Russia have shrunk substantially as Gazprom has taken back assets acquired by Itera under dubious circumstances at the end of the 1990’s. Other than Sibneftegaz, the company’s only remaining production affiliate is Purgaz, in which Itera holds 49%. Total production at Purgaz came to 15 Gm3 last year, of which 7.5 Gm3 was to Itera’s account - supply requirements on top of that were bought in by Itera from Russian independents. Itera’s gas sales in 2005 came to 20 Gm3, mainly to the Sverdlovsk region but also in Latvia, Estonia and Georgia.

Itera was once the intermediary company for the transit of Central Asian gas across Ukraine, a role which subsequently passed to Hungarian registered Eural Transgas and then to RosUkrEnergo from 2005.

As Itera’s star fades the biggest Russian diamond company Alrosa is now planning to diversify into the gas business. At the end of last year Aleksei Kudrin, Russia’s finance minister and chairman of Alrosa’s supervisory board said that Alrosa would turn into a many-faceted holding with oil, gas and coal assets. Alrosa is owned 37% by the Russian state through Rosimushchestvo and 32% by the Yakutia authority.

Alrosa last year acquired 50.4% of the former Yukos affiliate Sakhaneftegaz together with controlling shares in Sakha affiliates Yakutgazprom and Yakutgeofizika according to the Russian daily Vedomosti. Yakutgazprom holds licences for gas production in three fields in Yakutia with total reserves of 142.7 Gm3.

Last year, structures representing Alrosa acquired controlling shares in ZAO Geotransgaz from the Acropol’ group, according to Vedomosti. This company is developing a field neighbouring Beregovoye and may itself have been interested in buying into Sibneftegaz, but Gazprom got there first.

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