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. Last Updated: 07/27/2016

Business in Brief

$1.7Bln China Pipeline

MOSCOW (AP) ? Russia and China may sign a deal for a $1.7 billion pipeline to carry oil from Siberia to northeastern China during a visit by Chinese Premier Zhu Rongji to Moscow next week, the Chinese ambassador to Russia said Thursday.

The document would expand on a preliminary accord signed during Chinese President Jiang Zemin's visit to Moscow in July. Under that accord, both sides agreed to formulate a plan for the 2,500-kilometer pipeline.

A key result of Zhu's visit, scheduled to begin Sept. 7 and focus on boosting trade, is likely to be "a document on the joint construction by Russia and China of the oil pipeline, planned to be launched in 2005," Chinese Ambassador Zhang Deguang was quoted by Interfax as saying.

The pipeline project would be led by Russian oil producer Yukos and the pipeline monopoly Transneft and the China National Petroleum Corp.

Itera Buys Latvian Gas

RIGA, Latvia (Reuters) ? The Latvian arm of Russian Itera said Thursday it held "over 24 percent" of Latvian Gas after the Riga bourse auction of a state-owned 3 percent stake in the natural gas utility.

"We bought about 1.44 percent [at the auction]," said Itera Latvia president Juris Savicks, adding that it brings its stake in the utility to 24.5 percent or just over that amount.

Savickis also said Itera bought Fortum's 2 percent holding in the Latvian utility, which the Finnish company sold for 16 million euros in mid-August.

Itera earlier said it wanted to gain one more seat on the company's council, and it needed to raise its holding in Gas to 24 percent. It currently holds two seats on the 20-member council.

Polish Gas Deal

WARSAW, Poland (Reuters) ? Poland and Norway are set to sign a long-term natural gas supplies agreement Monday that is to significantly lessen Poland's dependence on Russian imports, the government's press office said Thursday.

The country's state-owned gas monopoly PGNiG late Wednesday approved imports of 74 billion cubic meters of Norwegian gas between 2008 and 2024, supplies valued by analysts at around $11 billion over the deal's 16-year life.

Despite opposition from the leftist Democratic Left Alliance, set to win elections next month, Poland and Norway are set to seal the agreement during a Monday visit by Prime Minister Jerzy Buzek in Oslo, the government's information bureau said.

Norilsk Gas Purchase

MOSCOW (MT) ? Metals giant Norilsk Nickel has purchased a 90.91 percent stake in Taimyrgaz, the Pelyatkinskoye gas deposit operator, Prime-Tass reported a Norilsk Nickel official as saying Thursday.

The official said Norilsk Nickel plans to begin full-scale development of the Pelyatkinskoye field in the northern Taimyr region before the end of the year.

Norilsk has already invested $300 million in the field since 1997, he said. Development of the field was one of the terms of Norilsk Nickel's privatization deal in 1997.

Reserves Slide $600M

MOSCOW (MT) ? Central Bank hard currency reserves fell by $600 million over the past week ? the largest drop in one week so far this year ? sliding to $37 billion on Aug. 24 from $37.6 billion a week earlier, the bank said Thursday.

However, the fall was entirely due to payments to Paris Club creditors totaling $1.2 billion, according to sources in the Finance Ministry.

Otherwise, the Central Bank has continued to build reserves by buying up exporters' revenues. The bank has broken even over the past two weeks, increasing its reserves by $600 million each week. The gains went to Paris Club creditors.

Cellular Rates 'to Fall'

MOSCOW (Reuters) ? Incoming Moscow cellular operator Sonic Duo said it would not sharply undercut competitors Mobile TeleSystems and Vimpelcom, but predicted drops in the price of cellular service when it arrived on the market.

"Sonic Duo won't engage in dumping," Sonic Duo CEO Alexander Yesikov said in an interview with the daily Vedomosti published Thursday, referring to plans for its tariff policy.

Both of Moscow's current operators have been nonchalant about the impact of Sonic's launch, which Yesikov affirmed was set for fall.

LUKoil Gets Hooked

MOSCOW (Vedomosti) ? LUKoil is vying to become a main player on the telecommunications market in Moldova and has plans to penetrate other former Soviet states, company officials said.

Through its newly established company Telemedia Group, LUKoil has begun network construction in Moldova and is currently in negotiations with the Moldovan Transportation and Communications Ministry about receiving a fixed-line and mobile license.

The company plans to invest $40 million to $60 million over the next two to three years and could break even in five to seven years, said Nikolai Chyorny, general director of LUKoil-Moldova.

He said LUKoil might participate in the Moldovan government's tender to sale a 50 percent-plus-one stake in national operator Moldtelecom.

LUKoil also intends to provide services in Ukraine and Romania, where it already has oil projects, and plans to double its current 50 percent stake in Azeri operator AzEuroTel, according to an official at that company.

40,000 AvtoVAZ Cars

MOSCOW (MT) ? Crimean-based automobile plant KrymavtoGAZ plans to assemble up to 40,000 cars a year from kits to be supplied by Russia's leading car manufacturer, AvtoVAZ, KrymavtoGAZ general director Anatoly Lazarev told reporters Wednesday.

Prime-Tass reported Lazarev as saying talks on joint production were proceeding.

Lazarev said AvtoVAZ would likely receive an unspecified stake in KrymavtoGAZ in return for the car-making equipment.

Mi-17-IVs to Colombia

MOSCOW (AP) ? State weapons exporter Rosoboronexport has signed a contract for the delivery of six Mi-17-IV helicopters to Colombia, its second such deal in four years, the company said Thursday.

Russian arms exporters delivered 10 such helicopters to Colombia in 1997 after Moscow signed an accord on military-technical cooperation with the Colombian government and after the Russian side won a special tender, the company said.

Mi-17-IV can transfer a fully equipped landing group of up to 30 servicemen to operation sites and later evacuate the wounded and prisoners, Rosoboronexport said. The helicopters have been used in anti-drug operations in Colombia, it said.

The sum of the contract, signed in Bogota, was not disclosed.

Private Deposits Up

MOSCOW (MT) ? Private deposits in Russian banks' ruble and foreign currency accounts rose to 563.1 billion rubles ($19.2 billion) in July, Prime-Tass reported the State Statistics Agency as saying Thursday.

The deposits were up 21.8 percent since Jan. 1 and jumped 41.7 percent year on year in January to July.

Ruble deposits in Russian banks rose 22.4 percent since the beginning of the year to 372.7 billion rubles, while foreign currency deposits rose 20.5 percent.

Gazprom, UES Taxes

MOSCOW (MT) ? Gas giant Gazprom and national power grid UES have overpaid their taxes this year by 8 percent and 9 percent, respectively, Sergei Dyukov, head of the Tax Ministry's department for major tax payers, told a news conference on Thursday, Prime-Tass reported.

He did not provide exact figures.

Since the beginning of the year, Gazprom has paid 9.4 billion rubles ($320 million) toward its tax debt, and UES has given 2.3 billion rubles ($78 million), Dyukov said.

He declined to specify the companies' full tax debt, saying the figures were confidential.

Most natural gas and electricity producers have expressed an interest in debt rescheduling, and some of them have made the relevant requests, Dyukov said.