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. Last Updated: 07/27/2016

Leading Moscow Refinery to Double Production

Central Fuel Co.'s affiliated Moscow refinery is planning to raise its output of the two most popular types of gasoline by about 2,000 metric tons a day to 5,500 metric tons a day by the end of this week, officials said Tuesday.

The refinery is able to increase its production of the A-92 and A-93 types of gasoline following renovations to its catalytic and hydro cracker units. CFC spent about 180 million rubles on capital expenditures at the refinery last year.

The utility currently produces about 3,500 tons of high-octane gasoline, the Moscow refinery's first deputy general director, Gennady Kuzovlev, said at a news conference Tuesday.

Even though the refinery provides about 75 percent of Moscow's high-octane gasoline, the refinery's production increase is unlikely to lead to any lowering of gas prices, due to high demand.

For a start, summer brings an increase in demand as people drive to dachas or to the countryside. Whereas Moscow usually consumes about 4,500 metric tons a day of high-octane gasoline, demand peaks in summer at 7,000 metric tons per day, Kuzovlev said.

The refinery will be able to cover this demand by refining a planned 800,000 metric tons of crude deliveries per month. That's a sizable increase from the 668,000 metric tons of crude it refined in May.

Kuzovlev also announced the refinery's 1998 results, headlined by a net profit of 406 million rubles on revenues of 2.4 billion rubles.

A shareholders meeting last week approved paying dividends of 20.6 rubles per preferred share. Ordinary shares receive no dividend.

The company still owes 37 million rubles of 1997 dividends for preferred shares. The refinery plans to pay off 9 million rubles on those dividends by the fall, with the whole debt to be redeemed by the end of the year.

It also owes 334.4 million rubles ($13.6 million) in tax arrears to the Moscow city and federal budgets as of June 1, as well as owing 135 million ($5.5 million) to the Federal Road Fund. The company plans to wire about 60 million to 70 million rubles per month to pay off accumulated taxes and other debts to the authorities, Kuzovlev said.

Moscow government-owned CFC holds a 51 percent stake in the refinery. Roughly 25 percent is held by a small group of Cyprus-based companies with the rest being spread among 8,322 shareholders including a 4 percent stake retained by the refinery's personnel, Kuzovlev said.