Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Business in Brief

Exxon Pipe Problems

MOSCOW (Bloomberg) -- Exxon Mobil Corp. may delay construction of a Russian oil pipeline because it has not received steel pipes from local suppliers, Tex Report's Daily Energy edition said, without identifying the source of the information.

Russian steelmakers were supposed to supply more than half of the 70,000 tons of steel pipe needed to complete the pipeline. Exxon, which had planned to start construction in October, may delay the project until next year because the Russian suppliers have not started making the pipes, Tex said.

A unit of Japan's JFE Holdings Inc. will supply 30,000 tons of steel for the project, Tex said.

JFE Steel Corp. may take two more months to supply the steel because partners in the Sakhalin project changed the specifications of the steel pipe needed, Tex said, without giving more information.

The Sakhalin-1 project plans to produce 250,000 barrels per day of crude oil by the end of 2005. Exxon Mobil and its partners plan to invest as much as $12 billion in developing Sakhalin-1, according to the project's web site.

Gazprom EU Exports

MOSCOW (Bloomberg) -- Gazprom, the world's top natural gas producer, said Friday that it increased exports to Europe 8.5 percent in the first seven months in an effort to boost revenue.

The company sold 82.1 billion cubic meters of gas to countries outside the former Soviet Union, compared with 75.7 billion in the year-earlier period, Gazprom said in a statement e-mailed to news services.

Domestic sales rose 5.8 percent to 218.2 bcm.

Deliveries of Russian gas to former Soviet republics totaled 54.9 bcm, while the shipment of gas from Central Asia across Russia for export was 23 bcm, Gazprom said, without providing a comparison to the year-earlier period

Severstal Upgrades

MOSCOW (Bloomberg) -- Severstal, the country's No. 2 steelmaker, said Friday that it will spend 47 percent more than originally planned this year to upgrade equipment and boost production.

The company's investment will rise to 11 billion rubles ($361 million), from 7.5 billion rubles planned at the start of the year, general director Anatoly Kruchinin said in a statement posted on Severstal's web site.

Severstal, which produces 18 percent of the country's steel, has said it plans to invest $715 million through 2007 to boost production to meet rising demand expected from oil producers, shipyards and carmakers.

The company, based in the northern town of Cherepovets, plans to increase raw steel production to 11 million metric tons per year by 2007, from 9.65 million tons in 2002. It plans to raise rolled-steel output to 10 million tons per year, up from 8.4 million tons last year.

Germania Flies In

MOSCOW (MT) -- A German low-cost carrier will start flying to Moscow's Sheremetyevo Airport on Aug. 26, Kommersant reported Saturday.

The company, Germania, will operate five weekly flights from Berlin and Munich on Fokker-100 aircraft for $250 return. On routes to and from Germany, the airline will face competition from Lufthansa, Aeroflot, Pulkovo and Sibir.

The airline also has plans to begin flights to St. Petersburg.

LUKoil Pumps More

MOSCOW (Bloomberg) -- LUKoil, the country's second-largest oil producer, said it expects to pump 4 percent more oil this year, doubling last year's growth rate, after it bought assets in northern Russia and western Siberia.

LUKoil pumped 36.3 million tons of oil (1.47 million barrels per day) in January through June, a 3 percent increase from the same period of 2002, said Gennady Krasovsky, a spokesman at the Moscow-based company. In the second quarter, output rose 4.6 percent.

"These numbers include subsidiaries where we own more than 50 percent and can consolidate their results under U.S. generally accepted accounting principles," Krasovsky said. "We'll try to maintain the last quarter's growth rate for the current quarter as well."

LUKoil is relying on oil projects in the Komi and Nenets regions of the Arctic to drive output increases. LUKoil's stock has risen 16 percent this year.

Ferrari Dealer to Open

ROME, Italy (Prime-Tass) -- Italian sports carmaker Ferrari plans to open its first dealership in Russia to sell Ferrari and Mazeratti cars in October, the company said Friday.

Previously, the cars were sold in Russia through dealer companies located in Germany.

Baring Fund Soars

LONDON (Bloomberg) -- ING Group NV's Baring Private Equity Partners Ltd. has earned returns averaging three times costs on the 16 investments realized by its Baring Vostok Fund in Russia, The Wall Street Journal reported, citing Mike Calvey, Baring Vostok's managing partner.

Baring Private Equity, which went into Russia in 1994, is one of the few foreign private-equity funds there, partly as lack of local knowledge has limited the number of foreign venture capitalists, the newspaper said.

Russia Partners LP, run by New York-based Siguler Guff & Co., is the only foreign private-equity firm with a track record as long as Baring's and is currently raising its second fund, with a $210 million target, the Journal said.

Tanker for Germany

ST. PETERSBURG (Prime-Tass) --Ship building company Baltiisky Zavod has launched the second chemical tanker built on an order from Germany's Transocean Shipmanagement, the company said Friday.

The average world price of a tanker of the same class varies from $12 million to $20 million, the company said without disclosing the deal's exact sum.

The first tanker, built in the framework of the contract with Transocean Shipmanagement, was delivered on July 28.

UAZ Reopens in Iraq

MOSCOW (Prime-Tass) -- The Ural Automobile Plant, or UAZ, based in the Chelyabinsk region, reopened its representative office in Iraq on Tuesday, Ruspromavto, the holding that controls the plant, said Friday.

UAZ's representative office in Iraq stopped operating in March due to the war.

The plant was damaged and ransacked during the war, Ruspromavto said, adding that UAZ has recently repaired the office.

In 2002 UAZ produced 8,600 trucks, of which 2,500 vehicles were exported to Iraq. This year UAZ expects to supply 2,000 heavy trucks to Iraq.

The plant is the country's leading producer of all-terrain trucks and the main supplier of heavy-duty vehicles to the army.

It is capable of producing up to 35,000 trucks per year.

MTS Interim Chief

MOSCOW (Bloomberg) -- The board of Mobile TeleSystems, Eastern Europe's largest mobile-phone company, will appoint an acting president Monday and select a nominee to fill the post permanently, a company spokesman said.

The nominee for president will be submitted to the company's general shareholders meeting in October, Andrei Braginsky, MTS's head of public and investor relations, said in an e-mail.

Last month Mikhail Smirnov, president of MTS, was named general director of MGTS, the Moscow city fixed-line operator, by AFK Sistema, a financial-industrial group with a majority stake in both MTS and MGTS.