THE LONDON TIMES: Rosneft to get £479m Menatep bill: “Shell has suffered a second downgrade to its debt rating. Standard & Poor’s, the rating agency, which stripped the Anglo-Dutch company of its triple A credit status last April, yesterday pushed Shell a further step down the ladder from AA plus to AA. The agency cited Thursday’s further cut to reserves and Shell’s poor reserve replacement record.” (ShellNews.net) 5 Feb 05
February 05, 2005
By Carl Mortished, International Business Editor
THE financial troubles of Rosneft, the Russian state oil company, will escalate next week when Menatep Group, the controlling shareholder of Yukos, demands repayment of $900 million (£479 million).
Rosneft is already under financial pressure after a syndicate of Western banks demanded immediate repayment of $540 million. The two loans are guaranteed by Yuganskneftegaz, the Yukos subsidiary that was taken over by Rosneft in a controversial bailiff’s auction last year.
Tim Osborne, the managing director of Menatep, said he expected that a demand for repayment would be made next Tuesday or Wednesday. “Why would we leave it for the benefit of Rosneft,” he said. “They are supposed to have just raised $6 billion.”
The Yukos lenders are calling in more than $1.4 billion in loans just as Rosneft seeks to raise funding to pay for the $9 billion takeover of Yugansk. Last week the state oil company said it had secured a $6 billion loan from CNPC, the Chinese state oil company. The loan is a prepayment on the future delivery of 48 million tonnes of crude oil. Yugansk was a major oil supplier to China before its forced sale in partial settlement of $27 billion in tax claims and penalties.
The Western banking syndicate is thought to be concerned about the use of Yugansk oil as collateral for the Chinese loan. The banks secured guarantees from the Yukos oil production subsidiary last summer after warning Yukos that it was at risk of a default. The oil company’s bank accounts had been frozen by the Russian courts and it was struggling to pay creditors and fight the Kremlin’s tax demands.
The banks’ action creates a new headache for the Russian Government The Kremlin has sought to engineer a nationalisation of Yukos’s core asset without exposing Rosneft or Gazprom — soon to merge with the oil company — to the threat of foreign litigation.
The emergence of Menatep as the major creditor of Russia’s state oil company is likely to further embarrass the Kremlin. Menatep is controlled by Mikhail Khodorkovsky, the oil tycoon who is in jail facing charges of fraud and tax evasion. Mr Khodorkovsky waged a political campaign against President Putin, using his vast wealth to finance opposition deputies in the Duma, Russia’s parliament. The tycoon’s political ambition is widely believed to be the cause of the Kremlin ’s pursuit of Yukos for alleged tax fraud.
Mr Osborne said that Menatep would fight to recover its loan.
“Rosneft bought Yugansk with all its obligations and I think they have no other choice but to pay up,” he said. “If they default, we will fight them where the rule of law exists under the international arbitration clauses of the credit.”
Shell has suffered a second downgrade to its debt rating. Standard & Poor’s, the rating agency, which stripped the Anglo-Dutch company of its triple A credit status last April, yesterday pushed Shell a further step down the ladder from AA plus to AA. The agency cited Thursday’s further cut to reserves and Shell’s poor reserve replacement record.