Moscow press review for March 21, 2011
MOSCOW. March 21 (Interfax) - The following is a digest of Moscow newspapers published on March 21 Interfax does not accept liability for information in these stories.
VEDOMOSTI:
The military operation in Libya does not threaten the global oil market or the revival of the world economy so far, most experts believe. Before the beginning of the unrest Libya used to extract 1.6 million barrels a day, now it extracts one third of that amount. Due to the upheavals in the Middle East and North Africa the prices of Brent crude oil have gone up 13.53% to $115.5 for a barrel since February, of WTI - 11.73% to $101.42 and of Russia's Urals - 13.32% to $110.32. The average annual oil price forecasts have been raised by $10-15 since the beginning of the year, Valery Nesterov from Troika Dialog says. Even before the launch of the Odyssey Dawn operation Credit Suisse increased its estimate of the price of Brent from $85 to $105.8; Bank of America Merrill Lynch by 42% to $108. The consensus forecast of analysts polled by Bloomberg is $102. ("Danger of Contamination")
It looks like Gazprom won't rush to liquidate Rosukrenergo. The trader won more than $527 million from Hungary's Emfesz in the Stockholm court of arbitration. The $820 million in Emfesz claims for unjustified severing of the gas delivery contract were rejected, two sources close to the sides to the litigation told Vedomosti. Now the arbitration ruling must be confirmed in national courts, in Hungary in particular, a Gazprom staff member said. When the process is completed, RUE shareholders can count on additional income. Gazprom owns 50% in RUE, the rest belongs to Cetragas (Austria) of Dmitry Firtash. ("Trader will live a Little Longer")
Vedomosti has got hold of Finance Ministry estimates of how much state coffers will receive in additional revenues from growing oil prices. The 2011 budget was drafted with a deficit amounting to 3.6% of the GDP (revenues - 8.8 trillion rubles, expenses - 10.7 trillion rubles) based on the estimate of an average price of Urals oil at $75 for a barrel. Now the Finance Ministry has considered two new scenarios: if the oil price goes up to $81 or to $93. In the first case state coffers will receive 546.8 billion rubles in additional revenues - 333.1 billion rubles from the oil and gas sector and 213.7 billion rubles from the rest of the economy. Given the second scenario the revenues will be 1.2 trillion rubles - 976 billion rubles and 216.7 billion rubles respectively. The Economic Development Ministry estimates the revenues from other sectors of the economy than oil and gas in the second case at 250 billion rubles, a ministry official said. Deputy Economic Development Minister Andrei Klepach predicts that this year the budget deficit will amount to 1% of the GDP. Russia many even come up with a deficit-free budget, First Deputy Chairman of the Central Bank Alexei Ulyukayev believes. ("Excessive Money")
Uralkali after merging with Silvinit intends to refinance a $1.5 billion Sberbank loan of its subsidiary - the Kama Mining Company, Uralkali CEO Vladislav Baumgartner has said. The loan terms are tough and no longer compatible with the market, he said. In 2008 the Kama Mining Company borrowed $1.5 billion from VTB Capital to pay for the license for the Polovodovsky section of Verkhnekamskoye potassium salts deposit. In 2009 it failed to pay the first installment to the bank because of the crisis and started seeking ways to refinance the loan. Sberbank lent it $1.5 billion at 9% per annum but put forward tough conditions. ("Loan is Pressing")
The fact that VTB and its affiliates have accumulated a controlling stake in the Bank of Moscow was reported to Vedomosti by two sources close to the bank's shareholders. One of them added that the state-owned bank intends to establish operational control over the Bank of Moscow soon as well. Mikhail Kuzovlyov, VTB First Deputy Chairman and Bank of Moscow First Vice President, is supposed to become president. Suleiman Kerimov who bought 3.88% from Goldman Sachs, has become one more Bank of Moscow shareholder. "("VTB takes Moscow over")
On Monday Euroset and its shareholders will decide whether to place shares of its parent company, Euroset Holding N.V., at the exchange in the nearest future, Vedomosti was told by a business partner of one of the shareholders. A source close to the IPO organizers confirmed the information. The pool of underwriter-banks has been formed and consists of Alfa Bank , VTB Capital, Goldman Sachs and Credit Suisse. Mandates have not been issued but this may happen any time: if the decision on the IPO is made, the placement will be conducted in April-May 2011 and premarketing may begin already on Monday. Alexander Mamut's ANN will be the main seller, Vedomosti sources say. It is ready to offer 30% to 50.1% of shares to investors depending on the market situation. ("Controlling Offer")
KOMMERSANT:
In Jordan Zarubezhneft may start developing not only oil shales but also traditional hydrocarbons. For a year and a half it intends to conduct geological prospecting on one of the blocks where it hopes to discover oil and gas. (p.11 "Zarubezhneft to drill Jordan")
Businessman Arkady Rotenberg has acquired one more Gazprom contractor. After Stroymontazh he bought Gazprom Bureniye from the monopoly for 4.05 billion rubles. The current losses of the company stand at 2 billion rubles. The new owner plans to upgrade it and take to foreign markets. Analysts don't rule out the possibility that in the future Rotenberg may unite the assets and conduct an IPO. (p. 11 "Arkady Rotenberg enters Gazprom Bureniye")
In 2011 the Russian government plans to continue large-scale financial injections in farming badly hit by last year's drought - subsidies from state coffers alone my increase 16% compared to the current farming development program. Together with all the recently announced measures the size of the government program may be increased by a quarter compared to the budget plan. Almost 80 billion rubles more may be spent on the 2010-2011 harvest than on the last good harvest in 2008-2009 - the target was set at 10 million tonnes less. (p. 8 "Agricultural Security Becoming Increasingly Expensive")
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