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. Last Updated: 07/27/2016

Business in Brief

WTO Deal Unlikely

The United States is unlikely to sign an agreement on Russia's entrance into the World Trade Organization before the end of this year, U.S. Trade Representative Rob Portman told reporters Monday.

Some questions remain open, he said, RIA-Novosti reported. Portman is head of the U.S. delegation to the WTO ministerial conference that begins Tuesday in Hong Kong.

Better access to the Russian market for foreign airplane makers and financial services firms, enforcement of intellectual property rights and sanitation for agricultural goods are among the most contentious issues in the bilateral negotiations over U.S. backing of Russian entry into the 148-member body. (MT)

11-Month Budget Surplus

Russia said its budget surplus rose to 1.62 trillion rubles ($56.4 billion) through November, more than two times higher than the government's target for next year.

The 11-month surplus was almost six times higher than the government's initial 2005 target of 278 billion rubles, or 1.5 percent of gross domestic product, the Finance Ministry said on its web site.

Revenue totaled 4.6 trillion rubles, 7.5 percent below the government's full-year target, the ministry said. Spending totaled about 3 trillion rubles, 2 percent below the limit approved for this year. (Bloomberg)

Novorossiisk Exports Rise

LONDON -- Crude oil exports from Russia's Black Sea port of Novorossiisk rose last week from the previous week, as mostly calm weather reduced loading disruptions.

Crude oil shipments rose to 1.05 million tons in the week to Dec. 10, up from 814,000 tons the previous week.

Shipments from the Black Sea usually face delays during the winter months as stormy weather often forces port closures, while fog and rules limiting large vessels passing through the Turkish straits to daylight hours add to disruptions. (Reuters)

Gazprom Dividends

Gazprom denied on Monday a report that it would pay a flat dividend for 2005, saying it was premature to talk about the payout until it disclosed financial results for this year.

"It is premature to discuss our dividend policy for 2005, as we don't know exactly what our profit will be this year. I can deny the report that our dividend will be flat this year," Gazprom spokesman Sergei Kupriyanov said in an interview. Interfax quoted an unidentified source as saying the firm was planning to pay 28.4 billion rubles in dividends for 2005, almost unchanged from 2004. (Reuters)

Slovakia Drops Yukos Plan

BRATISLAVA, Slovakia -- Slovakia has dropped a plan to buy back a 49 percent stake in the country's oil-pipeline operator, Transpetrol, now owned by Yukos, Economy Minister Jirko Malcharek said Monday.

Slovakia, which holds the remaining 51 percent stake in Transpetrol, sold the stake to Yukos for $74 million in 2001.

The government will allow Yukos to sell the stake to a third party, canceling the original plan to buy the shares back and sell them to another investor, Malcharek said. (Bloomberg)

Lisin Buys Scottish Castle

Steel billionaire Vladimir Lisin has bought a castle in Scotland for ?6.8 million ($12 million), ?800,000 more than the asking price, the Scotsman reported, citing Scottish Land Registry documents.

Lisin, who owns steelmaker Novolipetsk, is president of Russia's National Olympic Shooting Association and probably bought the 1,335-hectare Perthshire estate for grouse and deer hunting, the newspaper said.

Lisin is Russia's second-richest man, with a fortune of about $7.2 billion. He raised $609 million selling some of his Novolipetsk shares on Friday. (Bloomberg)

UES Credit Outlook

Power utility Unified Energy Systems, or UES, had its credit outlook changed to developing from stable by Standard & Poor's due to "large uncertainty" about reorganization, the agency said.

"Depending on the ultimate reorganization scenario approved by the government, both upside and downside-rating movements are possible," Standard & Poor's said in a statement Monday.

UES chief executive Anatoly Chubais is struggling to push through a reorganization aimed at attracting as much as $50 billion for upgrading Russia's power industry, which is the world's biggest by capacity.

Standard & Poor's affirmed its rating on UES at B+, four levels lower than investment grade. (Bloomberg)

RZD Unit Flotation

Russian Railways, or RZD, the world's second-biggest railway company, plans to spin off a container unit with a turnover of over $1 billion and float its shares in 2007-08, the firm's executives said on Monday.

RZD is planning to spin off several units as part of the government's program to liberalize the market and attract new investment in the industry.

RZD president Vladimir Yakunin told a news conference that the container firm would be set up on the basis of 47 large container centers in Russia and would also own all large containers, which currently belong to the parent company. (Reuters)

E.ON Looking to Moscow

BERLIN -- E.ON is in talks with Gazprom and Unified Energy Systems, or UES, to expand in electricity operations in the greater Moscow region, Manager Magazine reported, citing an interview with chief executive Wulf Bernotat.

E.ON is "interested" in the privatization of the Russian electricity market, and the area around Moscow is a market as large as Spain, the German business magazine said, citing Bernotat. (Bloomberg)

More Banks Raided

Moscow's Marketing Bank and Mezhotraslevoi Promyshlenny Bank were raided on Monday, Interfax reported, quoting an unidentified Interior Ministry source.

The source said that the raid at the Mezhotraslevoi Promyshlenny Bank was based on evidence of money laundering and legalizing contraband money, adding that a criminal case might be opened.

Last week, raids took place at Neftyanoi Bank, which prosecutors accused of money laundering, and MDM Bank. Neftyanoi Bank continued business as usual and did not encounter any liquidity problems Monday, bank spokeswoman Anna Yartseva told Interfax. (MT)

Kazakhstan Raises Output

LONDON -- Kazakhstan increased crude oil production by 0.7 percent, to 46.5 million metric tons, in the first 11 months of the year, Interfax reported Monday, citing the national statistics agency. Gas condensate extraction rose 25 percent, to 9.8 million tons, Interfax said.

The country boosted natural gas production by 29 percent to 13.3 billion cubic meters in the first 11 months of 2005 from the same period a year earlier, the news service reported. Petroleum gas output rose 2.5 percent to 9.8 billion cubic meters in the period. (Bloomberg)

Airline Budapest Listing

BUDAPEST -- Russia's AirUnion may list on the Budapest Stock Exchange, business daily Napi Gazdasag reported, citing the chief executive of AirUnion member KrasAir, which failed to buy Hungarian carrier Malev earlier this year.

AirUnion, whose members also include Domodedovo Airlines, Samara Airlines, Omskavia Airlines and Sibaviatrans Airlines, considers Hungary of strategic importance and may list its shares in Budapest, Napi said, citing KrasAir CEO Boris Abramovich, who is still interested in buying Malev. (Bloomberg)

Poultry Imports

Russia will allow imports of 1.13 million metric tons of poultry in 2006, about 74 percent of which will come from the United States, Interfax reported Monday, citing the government.

U.S. poultry producers can send 841,300 tons to Russia under the quotas, and 220,600 tons can come from the European Union, the news service said. (Bloomberg)

Shipper Borrows $320M

The country's biggest shipping company, Sovcomflot, and Japanese shipper Nippon Yusen have raised a $320 million syndicated loan to build two liquefied natural gas tankers, Sovcomflot said Monday.

The 12-year loan organized by Mizuho Bank will fund two tankers to lift crude from the $20 billion Sakhalin Energy project led by Royal Dutch Shell.

Under the agreement, Japan's Mitsubishi Heavy Industries shipyard will build two 147,200-cubic-meter tankers by the fourth quarter of 2007. (Bloomberg)