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. Last Updated: 07/27/2016

Slavneft Pays Out $350M

Oil majors Sibneft and Tyumen Oil Co. have decided to pay themselves a $350 million dividend out of Slavneft, the oil major they jointly acquired through a privatization auction late last year for $1.86 billion.

Slavneft's board of directors will recommend an interim dividend for the first half of 2003 of 10.65 billion rubles ($350 million) at the late September shareholder meeting, the company said in a statement issued Thursday. The board will also recommend paying no dividend for 2002, since the company was still state-owned at that time.

Shares of Slavneft, which has a free float of about 1 percent, are illiquid and remained unchanged Thursday, while shares of its major extracting subsidiary Megionneftegas jumped 10 percent to $11.70.

The hefty dividend "does not come as a surprise," said Stephen O'Sullivan, head of research with United Financial Group.

"I assume that just like Sibneft, Slavneft is paying out all of its half-year earnings," O'Sullivan said, though it is impossible to know for sure since Slavneft has yet to disclose its first half results.

Officials at the Tyumen Oil Co., or TNK, would not say whether the dividend from Slavneft would be reinvested, while a source in Sibneft said only that the dividends would appear on its consolidated accounts.

Sibneft shareholders, notably including Chukotka Governor Roman Abramovich, have already received one windfall dividend this year, when the company paid out a lump sum of $1 billion to pave the way for its merger with fellow oil major Yukos.

TNK, owned by Alfa Group and Access Industries/Renova, is going through a merger of its own with Britain's BP. TNK had hoped to include its stake in Slavneft as part of TNK-BP, the $18-billion company given the final go-ahead by the Anti-Monopoly Ministry this week, but the two sides apparently failed to agree upon a price.

"At some point, TNK did not know what to do with Slavneft's assets," said Erkin Nusurov, an oil and gas analyst with NIKoil brokerage.