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. Last Updated: 07/27/2016

Transneft to End Takeover in October

Itar-TassTransneft's Vainshtok speaking at the fourth International Pipeline Conference taking place in Moscow on Tuesday.
Crude oil pipeline company Transneft will issue new shares in August to acquire fuel pipeline company Transnefteprodukt, which the Transneft expects to be fully absorbed in October, the company's CEO Semyon Vainshtok said Tuesday.

Deputy Energy Minister Andrei Dementyev said Transneft preferred shares would not be sold for the merger of the oil pipeline operator with Transnefteprodukt, Interfax reported Tuesday.

Transneft also expects to get the government's 24 percent stake in a Chevron-led crude oil pipeline that links Kazakhstan to the Black Sea, Vainshtok said.

The $2.7 billion Caspian Pipeline Consortium, or CPC, link connecting Kazakhstan to Russia's Black Sea port of Novorossiisk is Chevron's main route for exporting crude from Kazakhstan and key to expanding its output in the Central Asian country. Chevron leads shareholders of the group that want to increase capacity along the link to 67 million tons of oil a year.

Russia is building up state-owned oil and gas companies as President Vladimir Putin seeks to use the country's energy wealth to bolster its political status. Transneft is planning new, multibillion-dollar export links to boost shipments to Europe and Asia.

Transnefteprodukt is building a new link to the Primorsk terminal on Russia's Baltic coast, which will bypass existing routes to the Baltic republics, Vainshtok said Tuesday.

Russia's oil pipeline to China may start operating in 2008, a Chinese government researcher said.

China may increase imports of crude oil from Russia to as much as 35 million metric tons next year when the pipeline is completed, Xia Yishan, a research fellow with the China Institute of International Studies, which falls under the Ministry of Foreign Affairs, said in at a conference in Dalian, China, on Tuesday.