9 Dec 2009 16:09

Bashneft assumes oil at $55 per barrel in 2010

MOSCOW. Dec 9 (Interfax) - Bashneft assumes oil priced at $55 per barrel under the basic scenario in its business plan for 2010, Alexander Korsik, the senior vice president of AFK Sistema for the fuel and energy business unit, told journalists.

"We believe a realistic, basic scenario is $55 per barrel of Urals crude. But we are also examining the possibility of oil priced at $45 and $65 per barrel," he said.

The final business plan for 2010 has not been confirmed, but it will include "substantial investment not limited by financial resources," he said.

The Bashkir refineries ended the practice of give-and-take refining this year, which has improved the group's financial results. "If nothing bad happens, this improvement will continue," Korsik said. Putting an end to give-and-take refining has substantially boosted profitability, but the company will continue to look for new ways to increase margins, he said. "We are now receiving the profits that used to go to the companies supply the refineries with give-and-take oil. But we don't know for certain that they were receiving the maximum possible profit. Therefore, we are studying the possibility of raising the margins. Perhaps this will be small-scale wholesale, retail, etc.," he said.

Sistema President Leonid Melamed said that the fuel and energy business unit has great potential. "The challenge in this area is to continue to raise efficiency. We must create a vertically integrated oil company and increase business primarily to achieve a balanced Bashkir fuel and energy complex. The challenge we face is to boost production," Melamed said.

He declined to comment when asked if Sistema is in talks to purchase RussNeft . "I confirm all the information announced previously by [Sistema's chief owner Vladimir] Yevtushenkov. I cannot comment further," he said.

Acquisition of 100% of Sistema Invest is part of the complicated process of forming a vertically integrated oil company, he said.

Yevtushenkov told Interfax previously that Sistema is interested in buying RussNeft, but that no talks are underway.

A source familiar with the situation said previously that Oleg Deripaska's Basic Element might announce the sale of RussNeft soon. Sistema is considered the leading contender to purchase RussNeft. Other sources have said former owner Mikhail Gutseriev might buy the company. Gazprom Neft was considered a potential buyer, but it turned down Basel's asking price - $7.5 billion-$8 billion - saying it was only prepared to assume RussNeft's debt.