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. Last Updated: 07/27/2016

Itera Chief Denies Stripping Gazprom Assets

LONDON — Russia's mysterious private gas trader Itera revealed some details of its ownership structure Friday and reiterated that gas giant Gazprom owned no part of its shares.

Itera president Valery Otchertsov said in a rare interview that the company was two-thirds owned by two funds under an employee stock option scheme, while seven individuals unconnected to Gazprom owned the remaining 39 percent.

"We will soon issue a statement which should clear any doubts about our ownership structure," Otchertsov said, adding that the statement would reveal the identity of the main individual shareholders apart from the two funds.

The list is likely to include Itera founder Igor Makarov as well as five U.S. citizens and a Swiss national, who Otchertsov said had partnered Makarov in creating the firm in 1992.

Makarov, now in his late 30s, is Itera's chairman.

Details of Itera's ownership have tantalized industry observers as its meteoric success has fueled speculation that the company was linked to Gazprom and enjoys cheap access to its development licenses and vast pipeline network.

Otchertsov said Gazprom did not own a single share in Itera, but admitted Itera had invested in a 0.2 percent stake in the gas monopoly on the domestic share market some years back.

"We have never received a cent either from the government or from Gazprom all these years. Gazprom has never given us any gasfields or free licenses to develop its fields," he said.

"We have never participated in asset transfer or any unsavory schemes," Otchertsov told a Russian gas conference on Wednesday, adding that Itera paid in full for its license to a Gazprom field as well as for pipeline use.

Itera is currently making the move from trading to production and expects output to rise to 80 billion cubic meters (bcm) by 2010 from 25 bcm this year and 6.6 bcm in 1999. It is also in talks to develop gasfields in ex-Soviet Central Asia.

"Itera has suffered from these rumors of shady Gazprom links — banks from which we sought credits and foreign partners have been hesitant," he said. "So we want this audit completed soon so these rumors and accusations can come to an end."

He said Itera had already submitted documents for a Gazprom-commissioned probe by PricewaterhouseCoopers and was also preparing for a separate audit by Arthur Andersen.

Otchertsov said the main Itera Group had its headquarters in the Netherlands with branches in 24 countries, including the United States.

Itera Group's Russian subsidiary, Itera Holding, is 60 percent owned by the Dutch firm with managers holding the rest.

Otchertsov said Itera was negotiating additional loans to fund planned expansion, including production and tie-ups with international power utilities.

So far it has won credits worth $540 million from Russian banks and two foreign banks — Banco di Napoli and Lebanon's Federal Bank of the Middle East, he said.

"Our outstanding debt to banks is $176 million at present, but we are in the process of seeking longer-term loans to fuel expansion," Otchertsov said, noting Itera planned investments of over $1.5 billion into production in the next decade.

Otchertsov said Itera was also considering a New York listing for which purpose it has retained Arthur Andersen to prepare its accounts for the next three years under U.S. generally accepted accounting standards, or GAAP.