2 Mar 2010 16:12

Inter RAO still discussing power sector asset swap with Gazprom

MOSCOW. March 2 (Interfax) - Russian electricity company Inter RAO continues to discuss asset swaps in the power sector with Gazprom , in particular assets that are part of the Russian gas giant's OGK-2 generating company, Inter RAO representatives said at a meeting with analysts.

Denis Fyodorov, head of Gazprom Energy Holding, told Interfax that the talks had resumed and that the holding had identified the Inter RAO assets that interested it.

Both sides have neither specified when the negotiation process will be complete nor the exact roster of assets for the swap.

"We are now determining pricing approaches: what to exchange for what, when, at what price, and for what reason. We're hoping for a quick decision," a top Inter RAO manager said. "Until Gazprom and we define the perimeter of our negotiations, it would be premature to identify assets."

The negotiations concern a "serious" number of assets, about several of which the talks are "totally specific," Fyodorov said. He did not say which, nor did he say if they were specific power stations or stakes in power companies.

"We are principally decided as to assets and our interest. The ball is in Inter RAO's court," Fyodorov said.

Talks on a possible asset-swap between Gazprom and Inter RAO were also announced last summer, and it was learned in December that they had been put on temporary hold. Fyodor said then that one reason they were halted was a management change at Inter RAO (Boris Kovalchuk from Rosatom replaced Yevgeny Dod as CEO in November, and is now acting CEO).

Dod told reporters when he was still Inter RAO's chief that an exchange might involve specific stations or stakes in power companies.

Gazprom Energy Holding has so far consolidated 53.47% of Mosenergo , 46.34% of TGK-1 , 8.34% of Inter RAO, 10.49% of Inter-District Grid Company Holding (IDGC Holding), 10.49% of RAO Energy Systems Vostok (East), and 99.2% of CentrEnergoHolding, which owns 44.4% of the OGK-2 generating company, 42.9% of the OGK-6 genco, 4.8% of TGK-13 , 4.4% of Kuzbassenergo , 8.3% of Inter RAO and 4.4% of Federal Grid Company UES.

Gazprom also holds 51% of the shares in the in-progress Kaliningrad (combined heat and power plant) TETs-2, the other shares in which belong to Inter RAO. The holding owns Kaunas TETs in Lithuania. Gazprom is also building Adler heat and power station in the Greater Sochi area.

Inter RAO has several stations in Russia, including the Northwestern and Sochi combined heat and power plants, and Ivanovo PGY. Inter RAO runs OGK-1 and recently consolidated control over TGK-11.

Inter RAO may soon receive stock packets in power companies that were not sold during the reorganization of RAO UES of Russia and remain on the balance sheet, specifically FSK UES and RusHydro . The company is also buying from FK Otkritie the fund Otkritie UES Capital partners Fund PLC, which was put together in the summer of 2008 from an almost 5% stake in RAO UES of Russia. The fund has on its books stakes in power companies spun off from RAO UES worth $1.5 billion.