U.S. News

Rosneft Unit Buys Yukos Assets for $6.4 Billion


A subsidiary of Russia's state-controlled oil company Rosneft on Thursday bought the remaining production and refining assets of bankrupt Yukos at an auction for 165.5 billion rubles ($6.42 billion).

The purchase adds to a recent series of acquisitions that have transformed Rosneft from a loose bundle of assets into the dominant player in Russia's oil market. The only other bidder was a little known company called OOO Versar.

The Rosneft subsidiary, called Neft-Aktiv, bought Yukos' Samaraneftegaz production unit, with a capacity of about 200,000 barrels a day, and three refineries.

Rosneft has bought other Yukos production units in previous auctions; the purchase last week of one of the units leapfrogged Rosneft over Lukoil as the country's largest oil producer. The state now has control of more than 40 percent of Russia's oil production.

Yukos, once regarded as among Russia's best-run and most transparent companies, was a favorite of foreign investors. But it was driven into bankruptcy by back-tax bills of some $30 billion.

The back-tax bills were imposed in a series of legal actions that many observers viewed as being aimed at dismantling the company to boost state control of the oil industry. The tax cases came in parallel with the conviction and imprisonment of former Yukos owner Mikhail Khodorkovsky on fraud and tax evasion charges.

Khodorkovsky had funded opposition political parties and some observers saw the case against him as punishment for possible personal political ambitions.

The two final auctions in Yukos' dismantling are to be held Thursday afternoon and Friday _ for its chain of gas stations and for its soaring headquarters in downtown Moscow where the auctions have been held.

Nikolai Lashkevich, a spokesman for the Yukos bankruptcy supervisor, said the series of auctions is likely to raise enough money to pay off all creditors. After the Samaraneftegaz auction, he said a total of 690 billion rubles had been raised and that total claims against Yukos were 709 billion rubles.

"With the remaining two auctions, we can confidently assume that all the demands of creditors will be paid in full," he said.