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. Last Updated: 07/27/2016

Business in Brief

TNK-BP Takes Shape

MOSCOW (Reuters) -- Oil giant BP and Alfa-Access-Renova group announced on Wednesday a board of directors for the company formed by BP's $6.75 billion investment in oil company TNK last month.

Mikhail Fridman, head of the Alfa group, would become chairman, while BP Vice President Robert Dudley would be chief executive. The new company would be called TNK-BP.

"The advisory board is intended to serve as the board of directors following the formal establishment of the company next year," BP and Alfa said in a joint statement.

Other appointments included BP's Rodney Chase as deputy chairman, TNK's German Khan as executive director, and Sidanco president Lawrence Smyth as chief operating officer. Sidanco is a subsidiary of the new company.

The appointments are preliminary until the official formation of the new company.

$90M for Ski Resort

MOSCOW (MT) -- Interros head Vladimir Potanin has announced a $90 million investment in the Krasnaya Polyana ski resort, a favorite getaway of President Vladimir Putin and Belarussian President Alexander Lukashenko, Vedomosti reported Wednesday.

Potanin has already spent $1 million commissioning a development concept. Together with partners Base Element, Vnestorgbank and Sistema, Interros will invest $40 million over the next two to three years and $50 million over the following four to five years.

Separately, Gazprom will invest $30 million on a new hotel, trails and ski lift.

The federal government plans to improve the road to Krasnaya Polyana from the Sochi airport next year, at a cost of 1.5 billion rubles ($47.6 million).

Gandhi Diamond Plant

MOSCOW (MT) -- Indian diamond entrepreneurs Radzhesh and Sundil Gandhi plan this month to open a diamond-cutting plant in Vladivostok capable of producing diamonds worth $25 million a year, Vedomosti reported Wednesday.

The brothers opened the diamond cutting facility Choron Diamond in Yakutia in 1999.

Experts suggested that the Gandhi brothers would use the Vladivostok factory as a step to establishing diamond mining operations in Primorye.

Mosenergo Tariff Woes

MOSCOW (Reuters) -- Moscow power provider Mosenergo posted net profit for 2002 to Russian accounting standards of 646 million rubles ($20 million), down from 2.07 billion ($65.6 million) in 2001.

"The reason for the fall was the Moscow regulator's significant delay in approving energy tariffs last year," Mosenergo said in a statement. "Production costs also increased because of a re-evaluation of key assets."

Moscow's tariff regulator last April approved electric power rate increases of 15 percent to 20 percent for Mosenergo, far below its 40 percent request.

Ruble Gains

MOSCOW (Reuters) -- The Central Bank held back on Wednesday from buying extra dollars from the unnerved market as banks' clients rushed to sell export receipts, sending the ruble to an eight-month high against the U.S. currency.

The ruble rose 6.69 kopeks in official early trade to a weighted average for settlement today of 31.4407 to the dollar from 31.5076 on Tuesday when it gained 5.43 kopeks.

"Again there appeared to be no Central Bank support (for the dollar), people tried to sell dollars at the price they could get," a dealer at a large commercial bank said.

The Central Bank, which holds a tight grip on the local market and usually moves fast to curb any excessive exchange rate volatility, abstained from curbing the ruble rise for a third consecutive session, dealers said.

VTB, UBS Credit Deal

MOSCOW (MT) -- Vneshtorgbank, the country's largest commercial bank, said Wednesday it has come to a $250 million, five-year-framework credit agreement with Union Bank of Switzerland, Dow Jones reported.

The agreement will allow loans in either Swiss francs, dollars or euros for the purchase of industrial goods by Russian companies, Dow Jones reported, adding that the two parties may agree on longer terms for certain loans on a case-by-case basis.

The deal reflects the growing ability of Russian banks to access international capital. Vneshtorgbank said the agreement would allow it to reduce the cost of its loans to Russian industrial customers.

French Cheese Factory

MOSCOW (MT) -- French dairy manufacturer Lactalis, which sells products under the President brand, will open a cheese factory in Istra in the Moscow region in early April, Renaissance Capital said in a morning report.

The factory required $13 million in investment to construct and is due to produce 6,000 metric tons of cheese, or double the amount of Lactalis' sales in Russia in 2002.

Industry heavyweight Wimm-Bill-Dann, by comparison, plans to produce 7,000 tons of processed cheese a year.

IEA: Oil Exports Down

LONDON (Reuters) -- Crude and oil products exports from the former Soviet Union fell about 20,000 barrels per day in February from the previous month to a total of 5.76 million bpd, the International Energy Agency said Wednesday.

The IEA, in its monthly oil market report, said also that FSU production had hit a new high of 9.85 million bpd in February, up from 9.82 million bpd the previous month.

The agency said February exports had been constrained by weather-related delays at Black Sea ports, where flows fell 430,000 barrels per day from January levels.

Moscow Refinery Plan

MOSCOW (Prime-Tass) -- The key shareholders of the Moscow Oil Refinery, oil major Sibneft and the Moscow Oil Company, or MNK, have signed an agreement outlining their relations, Sibneft said Wednesday.

Under the agreement, Sibneft and the MNK will "jointly make decisions concerning refinery management, and ensure the transparency of its financial and commercial functioning."

The two companies also agreed to stop all "corporate disputes."

Shareholders are to form a new management structure for the refinery in accordance with the distribution of their common shares.

WTO Access 'Possible'

MOSCOW (Prime-Tass) -- Russia can still join the World Trade Organization in 2003, Deputy Economic Development and Trade Minister Maxim Medvedkov told reporters Wednesday.

Medvedkov, Russia's chief WTO negotiator, said that "a technical possibility" still exists that Russia could join the WTO before the end of the year, adding that the country's chances will be clear by the end of April.

Vimpelcom Outage

MOSCOW (MT) -- Some of Vimpelcom's Moscow subscribers earlier this week found themselves unable to call out or receive incoming calls.

Vimpelcom, the country's No. 2 mobile operator, said the temporary connection problems affected less than 1 percent of their Moscow subscribers and were caused by the installation of new billing systems.

Network functions had returned to normal by Wednesday, the company said.

Norilsk: No New Strike

MOSCOW (Reuters) -- Metals giant Norilsk Nickel said Wednesday an assembly of workers representing over 60,000 employees of its key Arctic division had voted against starting a strike over pay.

"A total of 412 delegates voted against a strike as a means to solve labor disputes, only one voted for it, and 36 abstained," a Norilsk spokesman said.

Trade Volume Grows

MOSCOW (MT) -- Foreign trade volume grew by 30.8 percent to $12.3 billion in January 2003, compared to the same month last year, the State Customs Committee reported.

Foreign trade with non-CIS countries amounted to $10.2 billion, an increase of 31.4 percent. Trade with the CIS was worth $2.1 billion, up 27.7 percent.

Silovye Mashiny Profit

MOSCOW (Prime-Tass) -- The net profit of major Russian power engineering holding Silovye Mashiny rose to $41 million in 2002, from $23 million last year, the holding said Wednesday.

Silovye Mashiny includes St. Petersburg-based LMZ, Elektrosila, the Turbine-Blade Plant and the Kaluga Turbine Plant.