Three bidders will compete in Wednesday's auction of the gas assets of bankrupt Russian oil company Yukos, Kommersant newspaper said.
The paper said Italy's Eni SpA would face competition from Russia's state-controlled oil firm OAO Rosneft and ZAO Yunitex, which is bidding on behalf of strategic clients of ZAO Gazprombank, part of Russian state gas monopoly OAO Gazprom. Analysts believe Gazprom will be the ultimate winner of the auction as it will buy the assets it wants from the winner. The single lot bundles together Yukos's gas assets, including gas firms OAO Arcticgas and ZAO Urengoil, with its 20% stake in Gazprom's oil subsidiary OAO Gazprom Neft.
The Financial Times said on Wednesday, citing two people familiar with the matter, that Eni had signed a call option agreement with Gazprom, allowing the Russian firm to buy the Gazprom Neft stake if Eni wins. The stake has a market value of around $4 billion, while the auction has a starting price of $5.6 billion. A phone call was made between Russia's President Vladimir Putin and Italian Prime Minister Romano Prodi late on Tuesday, which the Kremlin said covered economic cooperation as well as other topics.
Rosneft is the wild card in the auction, since Gazprom is widely expected to win. Analysts say that if it bids up the price against a Gazprom-backed buyer, it risks opening up a bidding war with Gazprom in future auctions of Yukos assets. Rosneft won the first auction virtually uncontested, outbidding British-Russian oil firm TNK-BP Plc in less than 10 minutes with a bid at only a fraction above the starting price. The auctions need at least two bidders to be valid. Seven firms registered to bid in Wednesday's auction but only four put down the required deposit and one of those, gas trader Trans-Nafta, later withdrew, Kommersant said.
Rosneft is bidding through its affiliate NeftTradeGroup and Eni is taking part via its EniNefteGas subsidiary. Yukos shareholders say, the sell-off is illegal and have threatened to sue anyone buying Yukos assets, alleging that the Kremlin has deliberately destroyed what was once Russia's most valuable company in order to punish the political ambitions of its main owner Mikhail Khodorkovsky and to cement control of Russia's energy industry. Russia has already sold off Yukos's 9.4% stake in Rosneft, which Rosneft itself bought for $7.6 billion, and plans to sell its other assets within months to pay off its $26 billion debts. Rosneft is widely expected to win the lion's share of the series of auctions and has arranged a $22 billion credit line that helped fund its win at the first auction last week. (reuters.com)