Economy minister: Bashneft should be privatized under general rules, not sold to state co
MOSCOW. Nov 26 (Interfax) - Russian Economic Development Minister Alexei Ulyukayev believes that oil company Bashneft should be included in the privatization plan and sold under general rules, "not through purchase" by a state company.
"I think that Bashneft should be privatized according to generally accepted rules, not through purchase by another company that is controlled by the state," Ulyukayev said in an interview with German newspaper Frankfurter Allgemeine Zeitung when asked whether Bashneft might be sold to state oil major Rosneft as part of its privatization.
If one state company is sold to another, this by definition would not be privatization, the minister said.
Russia's oil sector is very competitive, so there is no reason for the government to hold stakes in it, which is why Rosneft will also be privatized, Ulyukayev said. Bashneft should not remain in the hands of the government and this company will be included in the privatization plan, he added.
However, to a large degree all this depends on the situation on the market, he said. The government owns 69.5% of Rosneft, of which a 19.5% stake is already included in the privatization plan. Technically speaking, these shares could be sold today, but given what is happening on the market the government would not be able to get a fair price, so this plan will be put off until market conditions improve, Ulyukayev said.
Asked about possible aid to Rosneft from the National Welfare Fund (NWF), the minister said he did not think that companies like Rosneft need state assistance, as they are in good financial shape. The situation is such: companies have projects and they are currently discussing them with the government. If Rosneft proposes a profitable project, the government will invest in it along with other investors, because under current rules the NWF can invest no more than 40% of capital in such projects, Ulyukayev said.
Asked what he would say to a foreign investor concerned that Bashneft is a new Yukos, Ulyukayev acknowledged that "this is genuinely a problem."
Investors should naturally bear risks, but "here we increased the perceived risk of investors," he said. Now Russia needs to somehow compensate for this, create a more favourable general atmosphere for investors in many regards, as well as think about whether the authorities can provide guarantees that there will not be a whole wave of such events, Ulyukayev said.