The Times: Imperial Energy poised to delay stock exchange move

April 20, 2007
Steve Hawkes

Imperial Energy, the oil explorer, is poised to delay a £550 million move to the main stock market after seeing its shares tumble over fears about its future in Russia.

The AIM-listed group last night admitted that its time-table “could slip” from next week in the first recognition that a concerted attack by Oleg Mitvol, the Russian environmental regulator, is disrupting its expansion.

A spokesman told The Times: “The company is still moving ahead with its plans to join the main market.

“However, it is clear that current circumstances may affect the timing.”

Mr Mitvol shocked the City two days ago by calling for an investigation into the company’s reserves in Western Siberia and threatening to revoke its licences.

Yesterday he urged the Russian Government to block future shipments from Imperial’s new 208-kilometre pipe-line and said that it had broken environmental rules.

Shares in Imperial fell 11 per cent, after a 15 per cent plunge on Wednesday.

Imperial floated on the Alternative Investment Market three years ago and it has been one of its best-performing stocks this year.

Its shares soared 40 per cent in one day last month when the group revealed a 150 per cent upgrade in proven and probable reserves across several fields in the Tomsk region of Siberia.

It claimed to be sitting on more than 800 million “2P” reserves — nearly double the amount held by Cairn Energy in India.

Peter Levine, Imperial’s chairman, was understood to be in talks with Mr Mitvol last night. Russia’s Ministry of Natural Resources would only confirm that Mr Mitvol was meeting the Governor of Tomsk to “discuss oil exploitation in the region”.

Earlier, Mr Levine had reiterated that the regulator’s threats were “without foundation”.

Analysts said that Mr Mitvol’s surprise attack may have been triggered by Imperial’s growing profile and designed as a warning shot about its future conduct.

Mr Mitvol is best known for his role in orchestrating the campaign that has forced Shell to cede control of a majority stake in the huge Sakhalin II project to Kremlin-controlled Gazprom.

President Putin wants Russian companies to take back majority stakes in the country’s major natural resources However, one industry expert said yesterday: “I think this is most likely Mr Mitvol wanting to keep his profile up, nothing more.

“You could argue he may be trying to force Imperial’s price down because someone like Gazprom wants to buy them, but a company of this size shouldn’t be keeping Gazprom awake at night.

“Unfortunately, until there is certainty, Imperial’s shares will fluctuate.”

Oleg Mitvol

—Oleg Mitvol, deputy head of Russia’s environmental regulator, an offshoot of the Ministry of Natural Resources, is seen as the Kremlin’s “attack dog”

—Mr Mitvol, 40, is famed for starting campaigns that often end up with foreign companies transferring assets back into the hands of the Russian state

—As well as Shell, Mr Mitvol has targeted TNK-BP over the huge Kovykta gasfield

—Last year shares in Peter Hambro Mining dived after Mr Mitvol questioned its licence. Hambro recovered after ministry backing

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources//article1680191.ece?Submitted=true

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