Oil, Nickel

Mining companies ask for benefits for work in the Arctic

In early March, the State Duma adopted in the first reading a bill on state support for business in the Arctic zone.

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Sechin states that USA has gained control over UC Rusal using sanctions

The US administration, using sanctions, actually gained control over UC Rusal, head of Rosneft Igor Sechin said in the framework of the panel session of the St.

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"Rosneft" places a bet on Trafigura.

Trader will provide the company with prepayment in hard currency.
The Swiss trader Trafigura, who from April, according to unofficial data, will buy about 1 million tons of oil per month from the oil company, can become the largest trader of "Rosneft". According to "the Kommersant", the contract provides for  advance payments, and under normal conditions for such contracts "Rosneft" can get almost $ 1 billion from the trader for the next six months. Cut out due to the sanctions from Western funding "Rosneft" needs funds to pay for off its debts.
The Swiss trader Trafigura is in talks with "Rosneft" to increase its purchases of crude oil from the oil company. According to Reuters, in April trader will start to export more than 1 million tons of "Rosneft" oil a month - nearly six times more than what Trafigura buys now. A source of "the Kommersant" in the market confirms this information, but adds that currently the contract is not concluded, the negotiations continue and the final volume of deliveries for the trader and delivery terms are not defined. "Rosneft" and Trafigura do not comment on the situation.

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Metallurgy-2014: under “star” of Mechel

The outgoing year in metallurgy will be remembered by everyone, first of all, due to events with Mechel. In 2014, the most indebted company in the industry lost most of its capitalization. It was threatened with bankruptcy, default, was asked to sell assets, restructure its debt and convert it into shares. It was threatened with the dismissing of its general director and principal owner of the company Igor Zyuzin from its management - but there are still no specifics on the future of Mechel.
The first problems of Mechel were found at the end of February, when its shares "went" down for unknown reasons, although some analysts suspected that this was due to its debts. The manipulation with the shares was attributed to speculators, and the Central Bank undertook to investigate. But no one then imagined that everything would go so far.
But the company also had positive aspects in the current year, in particular, the sale of assets, and the fall of the ruble allowed it to significantly reduce its debt.

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Templeton increases its shareholding in Lukoil and Norilsk Nickel

The Templetons Fund, Templeton Foreign Fund enlarged their shareholding in Lukoil and Norilsk Nickel in May – August 2014, the fund’s documentation reports.
By the end of August, Templeton Foreign Fund increased the volume of GDR in Lukoil to 557,800. Under the market price, they had to pay over $30 million for the shareholding.
As of today, Templeton Foreign Fund holds 2 million GDR in Norilsk Nickel. They had to pay $40 million for the shareholding.
Translated by Nadezhda Poltoratskaya

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"Surgutneftegas" and NLMK benefit from the weak rouble.

"The revenue for the companies is in dollars, while the majority of their costs are in roubles, so the weak rouble makes the costs in dollar terms less", - the UBS analyst, Konstantin Cherepanov is happy for the raw materials and metallurgical companies. According to Bank of America Merrill Lynch estimates the revenue of the oil companies can grow by almost 5% with the 10% devaluation of the rouble. The effect of a weak rouble is more visible for the metallurgists - this year's change of course will give some of them an additional 12% rouble revenue.
Oil and Gas.
The underrun of the oil and gas industry is due to the fact that rapid devaluation only compensates for the drop in the oil prices. So raw materials of the Brent brand fell by 16.8% to $ 92.19 per barrel since the beginning of the year, the rouble over the same period depreciated against the American currency by 22.5%. In this case, since the beginning of Q3 the oil and the ruble are on a par – the currency fell within that period by 18.2%, and the oil - by 18%.

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$1.46 bln invested into crude oil and natural gas production in Kazakhstan in Q1

There has been directed $2.221 billion of direct investments to Kazakhstan in Q1, 2014. $1.67 billion have been invested into the mining sector, of which $1.46 billion is directed into the production of crude oil and natural gas, LS writes.

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Russia opens subsoil for foreign companies

The government may ease operation conditions of foreign state-owned companies in Russia. Until now, they could get in projects of strategic deposits development in the country not more than 25%. Primarily, this liberalization aims to attract investors from China, India and the Middle East. Primarily state-owned companies conduct international expansion just in these countries, and Russia will reorient to partnership with them in condition of conflict with the West over the Ukraine.
The Government has instructed the Ministry of Natural Resources, Ministry of Economy and FAS to consider whether to give foreign investors the opportunity to increase their share in companies, which develop subsoil plots of federal importance (large deposits of oil, gas, gold, nickel, platinum and copper) in excess of the limit, set by the legislation. This topic was raised by CEO of Metalloinvest Andrei Varichev at the Cabinet’s meeting on July 10; he offered to amend the law "in terms of increasing the possibility of the presence of foreign investors – certainly, through consideration by the Government Commission - from 25% to 49%". According to him, such measures are necessary for the development of large deposits, in particular to attract project financing.
Now, according to the federal law 57, there is a special procedure of foreign investments in companies that hold licenses for subsoil plots of federal importance. These companies are considered to be controlled by a foreign investor if it has a share of 25% or more.

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Russia can abandon copper and nickel export duties from New Year

The Russian Government can abandon copper and nickel export duties in 2014, and to establish some other measures for supporting of the metallurgy companies, Vedomosti writes referring to the project of the protocol of the session with participation of the Premier D. Medvedev on November 25.
Under the document, Mr. Medvedev will order to the Ministries of Economy Development, of Finances and of Industry and Trade to elaborate before December 23 the measures for supporting of the metallurgy companies while the era of worsening of the state of affairs.

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