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. Last Updated: 07/27/2016

Business in Brief

AvtoVAZ Stake Freed



MOSCOW (Reuters) -- The government has formally approved the return of a controlling stake in Russia's biggest carmaker, AvtoVAZ, to the company, the government said Tuesday.

The government said on its web site that it had approved the move Dec. 29. The shares are being returned to the company, which builds the Lada and Niva cars, as part of a new restructuring plan for tax debts owed by the company.

The stake of 50 percent plus one share was taken by the government in 1999 as collateral for the debt, but the government has now decided the company needs to be able to own the shares to raise funds.




Russian-Finnish Grid?



FRANKFURT, Germany (Reuters) -- German utility RWE AG said last week that it was in talks about a project connecting the Russian and Finnish electricity networks, but that the negotiations were still at an early stage.

"In December, we had the first discussions with Finnish and Russian partners," said a spokesman for RWE Trading.

These were the Russian Nuclear Power Ministry, Russian power grid monopoly Unified Energy Systems and Finnish power grid operator Fingrid, he said. However, he declined to give an estimate of the investment RWE might be prepared to make in such a project.

The Financial Times Deutschland reported Thursday the scale of the investment was estimated at 120 million euros ($107 million).




First An-225 Flight



LONDON (Reuters) -- The world's largest aircraft, the An-225, made its first commercial flight Wednesday when it flew from Stuttgart, Germany to Oman carrying meals for U.S. military personnel, Ukraine's Antonov Airlines said last week.

The 250-ton-capacity cargo plane was carrying 187.5 tons of prepared meals to Thumrait in southern Oman and was operated by Antonov Airlines in conjunction with its British-based worldwide general sales agent, AirFoyle Heavylift, a statement said Thursday.

The capacity of the giant six-engine aircraft is more than twice as much as a Boeing 747-400 freighter, and it was originally designed to carry the Soviet space shuttle.




$175M Sibneft Loan



MOSCOW (Reuters) -- Russia's sixth-largest oil producer, Sibneft, said Tuesday its board had approved a $175 million syndicated loan from Western banks.

The loan will be jointly arranged by Societe Generale and ING Bank for 42 months and will carry interest at LIBOR plus 3.8 percent, a Sibneft spokesman said. It will be secured by Sibneft's export revenues.

Sibneft has indefinitely postponed a planned issue of a $250 million Eurobond, saying market conditions were more favorable for secured borrowings than a bond placement.




PMI Down to 52.4



MOSCOW (Reuters) -- The rate of expansion of Russia's manufacturing sector slowed in December, with the Moscow Narodny Bank Purchasing Index down to 52.4 from 53.1 in November, the bank said last week.

The PMI is designed to give a snapshot of business conditions, and 50 is the no change mark.

"The fall in the PMI reflected slower growth of output, new orders and employment in December," Moscow Narodny Bank said in a statement.

It was the third month in a row that the figure had indicated an easing in the growth rate, and the weakest growth since January 1999.




Promstroibank Issue



ST. PETERSBURG (Reuters) -- St. Petersburg's Promstroibank said Thursday it planned to issue a Eurobond of up to $100 million in 2002.

A spokesman said the bank would take a decision on the exact size and timing of the placement after an international audit for 2001 is finished.

The bank's net assets stood at 29.12 billion rubles ($966 million) as of Dec. 1.




Gasoline Tariff Cut



MOSCOW (Reuters) -- The government said last week it will cut export tariffs on motor gasoline and gas oil to 25 euros per ton from the current 39 euros ($35).

It said on its web site, www.government.gov.ru, that the new tariff would become effective one month after it was officially published. Normally a resolution in the government newspaper, Rossiiskaya Gazeta, appears within days after the statement is published on the web site.




Stay in Nickel Exports



MOSCOW (Reuters) --Metals giant Norilsk Nickel said it was not planning any exports in January and might also hold back from exporting in February.

In a weekend statement, the company said it exported 177,400 tons of nickel in 2001 together with 422,000 tons of copper.

"Our earlier planned volume for exports of nickel in 2001 was 155,000 tons. Our exceeding the planned volumes is linked with the fact that in January 2002 Norilsk Nickel will not export any nickel," the statement said.

"Moreover, nickel might not be exported in February 2002," it added.




Gazprom China Deal?



SINGAPORE (Reuters) -- PetroChina and Royal Dutch/Shell Group have signed a preliminary deal to lay a 4,000-kilometer gas trunkline from the west to the east of China, an industry source close to the deal said Tuesday.

The agreement, inked Dec. 31 in Beijing, included joint exploration and development of gas fields in the Xinjiang Uighur autonomous region, as well as construction of the trunkline from Xinjiang to Shanghai, the source said.

The source said Shell and Gazprom were in the foreign consortium, which will take 45 percent in the project. PetroChina will hold 55 percent.

A Shell spokesman based in Beijing declined to confirm the signing of the deal, but said negotiations between Shell and PetroChina had "achieved significant progress."

The behemoth project has strong backing from the Chinese government and is estimated to cost some 150 billion yuan ($18 billion).




Gas Exports Restricted



MOSCOW (Reuters) -- The government said Friday it will restrict exports of liquefied petroleum gas from January to June 2002 to meet domestic demand.

It said on the government web site, www.pravitelstvo.gov.ru, that the new export quota would be set every month by the State Customs Committee and the Energy Ministry.

It did not say what export quota was set for January, but added that the exact figure would be set as a percentage of output.




For the Record



Russia's foreign trade surplus slipped further in November, down to $2.87 billion from the previous month's $3.48 billion, the Central Bank said. (Reuters)

Cargill has sold 55,000 tons of Thai raw sugar to Russia, the world's top sugar importer, for January shipment at undisclosed prices, trade sources said Thursday. It would be the largest vessel to be loaded in the history of the Thai sugar trade, the sources said. (Reuters)

Russia's coal production is estimated to have increased 4.7 percent year on year to 270.04 million tons in 2001, Prime-Tass reported industry information agency Rosinformugol as saying. (MT)

Russia is to build 28 fishing trawlers worth about $140 million in 2002 as part of the federal program for the development of the fisheries industry for 2002 to 2010, Interfax quoted the deputy chairman of the State Fisheries Committee as saying. (MT)