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. Last Updated: 07/27/2016

Tyumen Oil Told to Pay Off Debt




Acting Prime Minister Sergei Kiriyenko sent a warning to one of Russia's biggest financial groups Friday, saying the government would repossess its stake in the Tyumen Oil Co. if it failed to pay off a $100 million debt.


Speaking to the State Duma, which refused his candidacy as prime minister for a second time Friday, Kiriyenko said Tyumen Oil's owners had failed to fulfill the terms of a recent privatization tender, at which they promised to pay 600 million rubles to the State Pension Fund by the end of April.


Alfa-Eko, part of the powerful Alfa Group, joined forces with the Russian-U.S. joint venture Renova to win the tender for a 40 percent stake last summer, and has since built a 50.1 percent controlling stake.


"I can say for sure that if that sum isn't paid to the Pension Fund according to schedule, we will nullify the auction for the Tyumen Oil Co. and return the shares to the government," Itar-Tass quoted Kiriyenko as saying.


Tyumen officials could not be reached for comment.


The acting prime minister's warning is only the latest twist in Tyumen Oil's long and tortuous privatization process. The original tender was postponed when the company's main production unit, Nizhnevartovskneftgaz, complained that the terms had been rigged in favor of the Alfa Group.


Alfa went on to win the tender, paying $810 million for the 40 percent share, but became embroiled in a battle for control of Nizhnevartovskneftgaz that lasted until early this year, when the two reached an out-of-court settlement.


The property battle appears to have hexed a cash auction for a second, 49 percent stake in Tyumen Oil. The auction was originally scheduled for August 1997, then postponed until November, when a federal arbitration court cancelled the auction without providing an explanation.