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. Last Updated: 07/27/2016

Business in Brief

Tax Service in Denial

MOSCOW (Reuters) -- The Federal Tax Service denied a report Monday that it had demanded back taxes from oil firms because of their use of transfer pricing.

Interfax had earlier quoted a source in the FTS as saying tax officials had sent claims for the 2001 tax year to a number of integrated oil companies.

The purported demands were based on a law that permits an extra tax bill if a firm's internal prices deviate by more than 20 percent from the market.

Interfax's source did not name the companies or say how much they might have to pay, but said one subsidiary of an oil firm, accused of lowering internal prices by 8 billion rubles ($285 million), could be billed 2 billion rubles.

Menatep Loan Threat

MOSCOW (MT) -- Group Menatep will sue state-owned oil firm Rosneft if it fails to pay off the remaining $800 million outstanding on a $1.6 billion loan guaranteed by supplies from Yuganskneftegaz within a "reasonable time," Group Menatep director Tim Osborne said, Interfax reported Monday.

Menatep, Yukos' main ownership vehicle, last week sent notice to Yugansk's new owner, Rosneft, that it was demanding immediate repayment on the loan.

"Our banking agent [Societe Generale] is in the process of corresponding with them [Rosneft] on paying off the loan ahead of time," Osborne told Interfax.

"If they don't pay in a reasonable time, then we will send them notice on the start of legal proceedings," he said.

Interfax said the outstanding amount payable was now a little more than $800 million.

LUKoil's Finland Plans

MOSCOW (Bloomberg) -- LUKoil, Russia's biggest oil producer, plans to acquire full control over Finland's gasoline and diesel fuel retailers Teboil Oy AB and Suomen Petrooli Oy.

LUKoil has notified the European Commission of its plan, the company said in a statement. The company did not say how much it plans to pay for the retailers. Teboil and Suomen Petrooli have a total of 289 gas stations and 132 outlets selling diesel fuel in Finland, LUKoil said.

LUKoil Ups Production

MOSCOW (Bloomberg) -- LUKoil, Russia's biggest oil producer, produced 7.4 percent more crude last year as higher prices spurred it to increase output.

LUKoil pumped 86.2 million tons (1.73 million barrels per day) of oil, up from 80.2 million tons in the previous year, the company said in a statement Monday. The amount includes both Russian and overseas projects, and LUKoil's shares in affiliated companies.

Gas production rose 14 percent to 6.47 billion cubic meters, compared with 5.66 bcm the previous year.

Surgut to Limit Growth

MOSCOW (Bloomberg) -- Surgutneftegaz, Russia's fourth-biggest oil producer, plans to limit crude output growth to 6.4 percent this year because of a lack of capacity in oil pipelines.

Surgutneftegaz plans to pump 63.2 million tons (1.27 million barrels per day) this year by drilling more wells, the Surgut-based company said Monday in an overview of its activities posted on its web site.

Surgut plans to produce 14.3 billion cubic meters of gas this year, the same amount it produced in 2004. The company plans to process more than 15.5 million tons of oil at its Kirishi refinery, which is being upgraded to produce higher-quality oil products.

Norilsk Mine Stake

MOSCOW (Reuters) -- Russia's top gold producer, Norilsk Nickel, has increased its stake in gold mining company Pervenets to 100 percent from 26 percent, Norilsk's gold mining arm, Polyus, said Monday.

It said in a statement that Pervenets has a license to develop the Verninskoye and Pervenets deposits in Siberia's Irkutsk region, with proven and probable reserves of 84 tons of gold and an average metal content in ore of 2.3 grams per ton.

Total resources at the two deposits may be 185 tons, the statement said.

Polyus said it intended to build a gold extraction factory close to the deposits to produce 5 to 10 tons of the metal per year. It did not elaborate.

Lockheed vs. MiG

NEW DELHI, India (Bloomberg) -- Lockheed Martin, the largest U.S. defense contractor, and Boeing may bid to supply fighter jets to India for the first time, competing with MiG and Dassault Aviation for an order of as many as 126 aircraft.

Chicago-based Boeing will offer its F-18 jet, senior vice president Thomas Pickering said in an interview in Bangalore, India. Bethesda, Maryland-based Lockheed Martin will offer its F-16 fighter, vice president Dennys Plessas said.

The order may be worth as much as $9 billion and would make it the biggest this year, Michael Kelly, an official at Lockheed Martin's international market development division, said in New Delhi on Monday.

Grain Export Forecast

MOSCOW (Reuters) -- Agriculture Minister Alexei Gordeyev on Monday narrowed the range of his forecast for 2004-2005 grain exports, saying they will be 8 million to 9 million tons.

"Grain exports will be 8 million to 9 million tons in the agriculture year that started on July 1," he said.

Gordeyev also said the government had no immediate plans for grain interventions -- a measure it used in 2001-2003 to stabilize the market.

"We are watching the situation," Gordeyev said.

Sugar Imports Cut

MOSCOW (Bloomberg) -- Russia, the world's largest sugar importer, cut imports of raw sugar by 58 percent last year as the country's beet crop surged to the highest in 11 years, boosting domestic beetroot-sugar output.

The country's beetroot-sugar output jumped to 2.2 million tons last year from 1.9 million tons produced in 2003, the State Statistics Service said in a preliminary report submitted to the Agriculture Ministry. The beet crop surged last year because of "favorable weather conditions," the service said in the report.

BP Azeri Production

BAKU, Azerbaijan (Reuters) -- British oil major BP has launched commercial crude production at its Azeri field off the Caspian Sea coast of Azerbaijan, where it will pump the first oil for the Baku-Tbilisi-Ceyhan pipeline to Turkey, BP said Monday.

BP said the field would pump 35 million barrels of crude this year (93,000 barrels per day).

"We've received the first oil," BP Azerbaijan head David Woodward said in a press release. "It signals the … culmination of many years of planning, construction and operations delivery."

BP said light crude from the Azeri field would initially be exported via Supsa and also the existing pipeline to Novorossiisk on Russia's Black Sea coast.

Raiffeisen Bank IPO?

VIENNA (Reuters) -- Austria's fourth-largest bank, unlisted Raiffeisen Zentralbank, should go ahead with plans to list its growing Eastern European arm, the unit's head told an Austrian newspaper on Monday.

Raiffeisen, which has been talking for months about possibly listing Raiffeisen International, expects between 500 million and 1 billion euros ($643 million and $1.29 billion) from an initial public offering, Herbert Stepic said in the Monday edition of the daily Die Presse.

Stepic said Raiffeisen International would discuss the issue with its owners in early March. Stepic did not say when the public offer might be made.

Usmanov Sheds Stake

MOSCOW (Bloomberg) -- Billionaire Alisher Usmanov sold his 1.2 percent stake in Corus Group PLC for $59 million, disposing of his last shares in the steelmaker, Vedomosti said.

Usmanov told the paper he sold the stake to Credit Suisse First Boston and has an option to buy it back after a year, if the price falls 30 percent by then.

"To my opinion, Corus shares are trading at a maximum level now," Usmanov told Vedomosti.

Bank to Sell Bonds

MOSCOW (Bloomberg) -- The Moscow Bank of Reconstruction and Development, a Russian lender controlled by billionaire Vladimir Yevtushenkov, plans to sell an undisclosed amount of dollar-denominated bonds this month.

The sale of three-year bonds is being organized by Dresdner Bank, said Ilya Savkin, vice president for capital markets at Dresdner in Moscow, in a telephone interview.