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. Last Updated: 07/27/2016

Business in Brief

$225M for Blue Stream

The Moscow Times

A consortium of 16 European banks signed an agreement Monday that gives Gazprom a 250 million euro ($225 million) credit for the Blue Stream pipeline.

The pipeline, which is already being built, will carry 16 billion cubic meters of natural gas to Turkey. Part of the pipeline will lie on the bottom of the Black Sea.

The project was undertaken by the gas monopoly Gazprom, which agreed with Italian oil and gas group Eni in December on a $2 billion finance package.

The credit from the banks will go toward overland construction of the pipeline, and the loan is guaranteed by Gazprom's export contracts to Europe. Last year, the gas giant's export revenues totaled $11 billion.

Yukos to Hike Output

The Moscow Times

No. 2 oil major Yukos hopes to increase its production 50 percent to 1.5 million barrels a day by 2005, Yukos CEO Mikhail Khodorkovsky said Monday.

"The technology is there, out in the fields," Khodorkovsky said. "Now it's purely an organizational problem."

Speaking at a European Business Club briefing, Khodorkovsky also told company representatives he wanted Yukos to begin natural gas production. In the next three to five years, Yukos will start to exploit the gas it extracts along with oil. Currently that gas is flamed, but Khodorkovsky wants to see it used to produce electricity on company sites.

However, he remains skeptical of oil companies' abilities to penetrate the electricity market. "Without demonopolization [of energy grid Unified Energy Systems], there isn't much you can do," he said.

Paris Debt Paid in April


ST. PETERSBURG — Russia will fully repay its overdue January debt to the Paris Club of creditor nations at the start of April, Deputy Finance Minister Sergei Kolotukhin said Monday.

"We are $310 million overdue for January," Kolotukhin told a news conference. "We will pay 50 percent of the sum at the end of the month and 50 percent at the beginning of April. From that point on, we will pay according to the original schedule of payments to the Paris Club."

He added he had signed documents for paying the first half of the $310 million three days ago. Russia's March debt to the club amounted to about $25 million, he said.

Russia angered the Paris Club at the start of the year by saying it would not honor its $40.2 billion debt in full and asking to restructure the Soviet-era debt.

12% Growth for Candy


The Russian market for chocolate bars could grow by as much as 12 percent this year, a spokeswoman for Nestl? in Russia said Monday.

She did not supply exact figures for 2001, but said analyst figures showed Russians ate around 350,000 tons of all kinds of chocolate products in 2000.

Russian chocolate consumption is starting to increase after falling following the 1998 financial crisis, according to industry analysts.

In 1998, Russia consumed 335,000 tons of chocolate, 56,000 of which were in the form of chocolate bars. Only 39,000 tons of chocolate bars were eaten in 1999.

Steel Scrap Exports Hit


MONTE CARLO — Russian exports of stainless steel scrap will decline this year, a Western trader said Monday.

"I believe there will be future duties as the government is keen to protect local producers," Anders Nilson, managing director of the stainless steel trading group Kominox AB, told the CRU conference on stainless steel in Monte Carlo.

On March 2, the Russian government severely restricted the flow of scrap exports in a bid to crack down on the problem of smuggling and theft associated with ferrous and nonferrous scrap.

"The ban effectively stops the outflow of scrap, so the exports could drop this year, but there is still a lot of scrap out there," he said.

Many players in the European market have attributed part of the weakening in local consumption of primary metal to the abundance of Russian scrap on the market.

Profit Tax Draft Law

The Moscow Times

A draft law on profit tax was submitted to the State Duma on Monday, the Duma's budget committee told journalists, Interfax reported.

The draft law is designed to stimulate investment, the committee said.

The rate of the tax will be retained at 35 percent, with 10 percent of that amount going to the federal budget, 20 percent to the budgets of the subjects of the Russian Federation and 5 percent to local budgets.

The tax subcommittee of Duma's budget committee will consider the draft law Tuesday.