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. Last Updated: 07/27/2016

Gazprom Neft Seeks NIS Stake

Top executives from Gazprom Neft visited Belgrade to convince Serbian leaders to sell it a majority stake in state-owned oil monopoly NIS, daily newspaper Politika reported Tuesday.

The privatization of NIS was first discussed in 2005 but has progressed slowly. Serbia promised to sell NIS by the end of the year, but officials and analysts say the tender is more likely to happen next year.

The Gazprom Neft executives will meet Serbian President Boris Tadic and Prime Minister Vojislav Kostunica.

"The sale of a majority stake in NIS could be one of the main topics at the meetings," Politika said, citing government sources. "The Russian company said it was interested in buying 51 percent of shares in NIS."

But the acquisition will only be lucrative to the company's estimation in the long term, Troika Dialog's oil and gas analyst Valery Nesterov said. "It won't be cheap," he said. "It would need substantial investment, and it's difficult to buy refineries competitively these days."

Gazprom Neft stock soared 8 percent Tuesday after Troika Dialog issued an upbeat report on the company.

The brokerage said Gazprom Neft was the cheapest and most profitable integrated oil company in the country.

"The company is one of the few that has disclosed an interesting production plan," Nesterov said. "They're in good shape, but have been disregarded by investors since being taken over by Gazprom."

Reuters, MT