Tags: Rosneft | Itera | Russia | Gas

Rosneft Buys Itera Stake for $2.9 Billion to Expand Gas Business

Tuesday, 02 Jul 2013 08:01 AM

Rosneft, Russia's top oil producer, said on Tuesday it had bought the remaining 49 percent of gas company Itera for $2.9 billion from its founder, furthering its aim of becoming Russia's largest independent gas producer.

CEO Igor Sechin wants to make Rosneft a global energy player and is aiming for output of 100 billion cubic meters (bcm) of gas a year by 2020 from about 13 bcm last year, versus dominant gas producer Gazprom's 479 bcm.

With Russia's No. 2 gas producer Novatek, it is lobbying for access to export liquefied natural gas (LNG), a right held only by Gazprom. Rosneft and Novatek are planning new LNG facilities in Asia and Siberia respectively.

Itera is Rosneft's second big acquisition after its $55-billion takeover of TNK-BP, once Russia's No. 3 oil producer.

Founder Igor Makarov built Itera up to be a top gas supplier to the former Soviet Union republics in the 1990s thanks to its good ties with his native Turkmenistan and his friendship with former Gazprom executive Rem Vyakhirev.

After a management shake-up at Gazprom in the early 2000s, Itera's business started to shrink, especially after Gazprom secured the monopoly on Russian gas exports in 2006.

Russia, the world's No. 1 crude producer, has lost its pole position in gas production to the United States in the last few years. Moscow is trying to keep its global influence by building new LNG facilities and promoting "gas OPEC," the 13-member Gas Exporting Countries Forum.

© 2017 Thomson/Reuters. All rights reserved.

 
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Rosneft, Russia's top oil producer, said on Tuesday it had bought the remaining 49 percent of gas company Itera for $2.9 billion from its founder, furthering its aim of becoming Russia's largest independent gas producer.
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2013-01-02
Tuesday, 02 Jul 2013 08:01 AM
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