Shell in talks with Sibir on swap deal
By Sylvia Pfeifer
Published: August 3 2008 18:44 | Last updated: August 3 2008 18:45
Royal Dutch Shell is in talks with smaller rival Sibir Energy about an asset swap that could see the oil major emerge with a large stake in the Russian-focused group.
The two companies are equal partners in the Salym fields in eastern Siberia. Under the proposal, Shell would swap its 50 per cent stake in the fields for an equity holding in Sibir itself.
People close to the talks last night cautioned that the discussions had been going on for several months and there was no guarantee they would be successful. Sibir declined to comment.
Sibir, whose biggest shareholder is the billionaire Shalva Chigirinsky, is the largest company on Londons Aim, with a market value of £2.3bn. It last month reported a trebling of full-year pre-tax profits to $344m (£174m) and said it hoped to migrate to the FTSE?100 index later this year.
At the time, the company said it still hoped to resolve a long-running dispute with Gazprom, the Russian energy group, over the control of the Moscow Refinery by the end of the year.
For Shell, the proposed asset swap would allow it to retain an economic interest in the Salym developments while distancing itself from operations on the ground.
Two years ago, the company was forced to surrender control of the huge Sakhalin-II oil field to Gazprom in what was seen as part of a wider move by the Kremlin to renationalise its resource assets.
Meanwhile, rival BP is still locked in a dispute over the control of its Russian joint venture, TNK-BP.
EDITORS CHOICE
In depth: Oil – Apr-29
Surging oil price boosts Shell – Jul-31
Cook leads in Shells two-horse race – Jul-21
Shell boosts second generation biofuels – Jul-16
Copyright The Financial Times Limited 2008
EBOOK TITLE: “SIR HENRI DETERDING AND THE NAZI HISTORY OF ROYAL DUTCH SHELL” – AVAILABLE ON AMAZON
EBOOK TITLE: “JOHN DONOVAN, SHELL’S NIGHTMARE: MY EPIC FEUD WITH THE UNSCRUPULOUS OIL GIANT ROYAL DUTCH SHELL” – AVAILABLE ON AMAZON.
EBOOK TITLE: “TOXIC FACTS ABOUT SHELL REMOVED FROM WIKIPEDIA: HOW SHELL BECAME THE MOST HATED BRAND IN THE WORLD” – AVAILABLE ON AMAZON.
