Russian govt to offer freight shippers stake in Moscow-St. Petersburg HSR - paper

MOSCOW. Oct 8 (Interfax) - The Russian government plans to bring freight shippers into the project to build the Moscow-St. Petersburg high-speed railway (HSR) by offering them a stake in the parent company of the concession holder for the project, national daily Kommersant reported on Tuesday.

JSC HSR Two Capitals Management Company, the founder of project concession holder HSR Two Capitals LLC, will have charter capital of 328.5 billion rubles and its controlling shareholder is supposed to be state company Moscow Metro, the paper said, citing a source familiar with discussions on the shareholder structure. Moscow Metro might get a stake of 51.7%, which corresponds to a contribution of about 170 billion rubles.

Russian Railways (RZD) is expected to contribute 88 billion rubles for a stake of 26.9% and Russian regions are expected to contribute 51 billion rubles for 15.5%. Asset management company CJSC Leader will invest a symbolic 10 million rubles, which will give it 0.0031%.

The Transport Ministry did not respond to questions, the paper said. Moscow's Transport Department, citing the project plans and presidential instructions, said the city will help finance the HSR with a contribution of at least 150 billion rubles. "The mechanism for contributing the city's money is determined by the government of each region independently," the department said.

The government proposes to raise another 19 billion rubles from freight shippers for a 5.8% stake. This option was discussed at a meeting at the Transport Ministry on October 4, the paper said.

The paper reported a source as saying that the largest oil and gas, mining, metals and chemical companies are being invited to join the project. Partners being considered include Rosneft , Novatek , Lukoil , Uralkali , EuroChem (OKPO code: 17902379), PhosAgro , Evraz, NMLK , Severstal , Rusal , SUEK, Sibanthracite and Kuzbassrazrezugol .

In exchange for their contribution, these companies might get priority access to freight shipments by railway to ports in Russia's Northwest. This refers to shipments to stations on the October and Northern railways from all stations on the railway network.

Priority access would apply to the 30 million tonnes of throughput capacity on approach lines to ports in the Northwest that is supposed to become available as a result of the construction of the HSR and the return of freight traffic to the main line of the October Railway. This is expected to increase throughput capacity on this route to 220 million tonnes per year by 2030.

The 30 million tonnes would be distributed in proportion to the amount of shares purchased by the freight shipper. But if a shareholder no longer needs priority, they will be able to sell their stake and the priority access along with it, the paper's sources said. RZD refrained from commenting on the situation.

Freight shippers are also being enticed with the prospect of dividends. HSR Two Capitals Management Company shareholders are supposed to earn a total of 10.4 trillion rubles in the period from 2045 to 2064, meaning shippers would get about 600 billion rubles on their shares.

Representatives of major companies did not respond to the paper's questions for the most part. A source at a steel company confirmed receiving the proposal, while a chemical industry source said such proposals have been made to companies, but "without hard terms and on a voluntary basis."