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. Last Updated: 07/27/2016

Business in Brief

Privatization Requests


The government asked the State Duma on Thursday to allow the privatizations of three big companies in 2001 to raise funds needed to pay foreign debts.

The government, short of some 183 billion rubles ($6.4 billion) to pay foreign debts this year, aims to raise an extra 15 billion rubles in privatization revenues on top of the 18 billion rubles already budgeted for.

The government submitted proposals to the Duma to sell a 79.73 percent stake in Siberian Kuzbassugol mining company and a 15.72 percent stake in the regional utility Chelyabenergo.

The government also wants to sell a 23.79 percent stake in Western Siberian Metallurgical Plant. The privatization proposals are part of a wider plan to come up with extra funds to meet debt obligations in the absence of a restructuring deal with the Paris Club of creditor nations.

The Duma passed a law last year that effectively banned privatization of firms with assets exceeding $150 million, pending approval of a new privatization law. The size of the assets of the three companies offered for sale Thursday by the government was not known.

BP-Rosneft JV


BP Amoco and state-run Rosneft have agreed to explore the Astrakhanovskaya gas field off the Far East's Sakhalin island, spokesmen for the companies said Thursday.

"We already have a joint venture, Sakhalin-5, in which Rosneft holds 51 percent and BP 49 percent," BP's Peter Henshaw said.

"We have agreed to extend this joint venture to Astrakhanovskaya field in the Sakhalin-4 project."

Astrakhanovskaya has estimated reserves of 100 billion cubic meters of gas. Rosneft has the developing license.

Rosneft explored Astrakhanovskaya with U.S. company Atlantic Richfield Co., or Arco, for several years. But Arco pulled out of the project last year after being taken over by BP Amoco.

Henshaw said BP and Rosneft had agreed to participate jointly in developing oil and gas fields adjacent to Sakhalin-4 if the government decided to tender for them.

Vote on Chubais' Fate

The Moscow Times

Deputy Energy Minister Viktor Kudryavy said Thursday that national power grid boss Anatoly Chubais illegally holds his job as CEO of Unified Energy Systems and shareholders in the monopoly should vote on his fate, Interfax reported.

Kudryavy wrote to the board of UES last week saying such a vote should have been held last year, though no vote on Chubais' fate has been held since the utility changed its charter in June 1999, the news agency said.

UES shareholders will vote April 28 on proposals to change the power utility's charter to make it easier to fire Chubais and give the board more say over asset sales.

Reserves Fall $500M

The Moscow Times

The Central Bank said Thursday its foreign exchange and gold reserves fell by $500 million for the week ending Feb. 16 to $28.9 billion, Interfax reported.

Last week, reserves fell to $29.4 billion from a high of $29.5 billion Feb. 2.

The Central Bank rarely comments on changes in reserves, though officials have said the government's strong finances are due to high oil and commodity prices. The reserves more than doubled in 2000 to $27.95 as of Jan. 1 from $12.46 billion a year earlier.

PM Touts Small Firms

The Moscow Times

Prime Minister Mikhail Kasyanov on Thursday criticized the government's efforts over the last few years for not creating the right conditions for the development of small businesses, Prime-Tass reported.

Kasyanov, speaking at a weekly Cabinet meeting, said that the small-business sector now employs about 8 million people and accounts for about 5 percent of the country's industrial output and about 15 percent of services.

The government has not created "additional stimuli to encourage the development of small business," which is why this sector has not been growing, the news agency quoted Kasyanov as saying.

"Small businesses have occupied strong positions in the development of the economy in recent years," Kasyanov said, and have "become an element of the market economy that we are trying to build."

Palladium Drops $15


LONDON — Palladium prices dropped $15 in early trade after losing ground in Asia overnight on the news that Russia may sign export quotas to release the metal by the end of the month, traders said.

"Palladium dropped $30 [Wednesday] on what felt like producer selling, confounding any fears of supply problems out of Russia," said one London-based trader.

An official of the group controlling Russia's largest platinum group metals producer, Norilsk Nickel, said Wednesday that President Vladimir Putin could sign a decree on PGM export quotas by the end of the month, allowing the metals onto global markets by mid-March.