Bloomberg News

Rosneft Board May Weigh $15 Billion Deal Tomorrow, Otkritie Says

February 27, 2012

The board of OAO Rosneft (ROSN), Russia’s biggest oil producer, will consider a “major deal” tomorrow, said Alexander Burgansky, an oil analyst at Otkritie Financial Corp.

The agenda may involve a $15 billion deal, such as amending the terms of a 2009 oil-for-loan agreement with China or a continuation of its exploration and production agreement with Exxon Mobil Corp. (XOM), Burgansky said today by e-mail. Otkritie is part-owned by state-controlled lender, VTB Group.

Andrei Knutov, a spokesman for Moscow-based Rosneft, declined to comment when called by Bloomberg.

Rosneft said last week that its board will discuss the price of a share buyback and deals exceeding $500 million in value at a Feb. 28 meeting. A regulatory filing on the meeting didn’t provide further information.

Minority shareholders that oppose the deal may be offered a buyback, Burgansky said.

In September 2009, Rosneft bought back stock from minority shareholders that voted against an oil-for-loans deal with China. Rosneft agreed to borrow as much as $15 billion for 20 years and supply about 9 million metric tons of crude annually under that deal, according to the company’s website.

Rosneft selected Exxon last year as a partner to tap the Kara Sea, a little-explored area in the Arctic that may be an extension of Russia’s western Siberian oil province. The two will also explore deep-water Black Sea deposits. In return, Exxon agreed to offer Rosneft participation in projects in Canada, Texas, the Gulf of Mexico and elsewhere.

To contact the reporter on this story: Stephen Bierman in Moscow at sbierman1@bloomberg.net

To contact the editor responsible for this story: Torrey Clark at tclark8@bloomberg.net


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