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. Last Updated: 07/27/2016

Itera Offers to Pay Rospan Debt

Itera said Monday that it has offered to pay all the debts of a beleaguered Siberian natural gas producer to keep it out of Tyumen Oil Co.'s hands.

At stake is Rospan International, a company created to develop high-pressure gas and gas condensate deposits in the New Urengoi and East Urengoi fields. Rospan, founded in 1992 by famed geologist Farman Salmanov, holds the license to an estimated $9 billion in reserves.

Itera made its offer to pay Rospan's debt of 2.3 billion rubles ($78 million) at a Rospan shareholders meeting on Saturday. Itera owns 51 percent of Rospan.

"We plan to fully pay off the debt in accordance with the current register of creditors," Itera said in a statement. "The sum will be put on deposit at the Moscow Arbitration Court."

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Creditors will be able to claim their funds after they sign an agreement to drop bankruptcy claims, it said.

TNK said it has not been notified about the proposal.

"I can't comment because we haven't received any documentation," said a TNK spokesman. "We found out about it from the newspapers."

Itera spokesman Nikolai Semenenko said an official notice has already been sent out and TNK should receive it shortly.

TNK first declared its intentions to acquire Rospan in June, when it acquired more than 50 percent of Rospan's debt. Rospan has been in the throes of bankruptcy since 1998, when then-controlling shareholder Gazprom failed to invest money promised when it bought the stake from Salmanov and his associates.

In 1999, Gazprom sold its stake to Itera, a gas trader-turned-producer, for a nominal sum of $300.

Last year, the Moscow Arbitration Court declared Rospan bankrupt, sending creditors — which include obscure firms such as Nafta-Energiya and Yamalstroi — scurrying to vote in their own external manager.

Enter TNK. Now Russia's No. 3 oil company after the conclusion of its fight for Chernogorneft and Sidanko, TNK wants to step up its involvement in Russia's natural gas sector.

"Expansion of our gas assets has been a centerpiece of our strategy for years," TNK CEO Simon Kukes said in June. "This makes Rospan attractive. We are confident that we can rebuild the company and make it profitable."

On Thursday, TNK succeeded in pushing through a decision to issue an additional 3 billion rubles of Rospan shares at a creditors' meeting. This would give TNK a majority of the stock and dilute Itera's share to 7 percent.

Itera representatives contend that the creditors' meeting was unlawful because the two companies were excluded from the proceedings. The companies will contest the meeting's results in court, Semenenko said.