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TNK-BP to sell Udmurtneft to China's Sinopec

MOSCOW, June 20 (RIA Novosti) - TNK-BP (RTS: TNBP) said Tuesday it would sell Volga-region oil producer Udmurtneft (RTS: UDMN) to Chinese company Sinopec.

"The sides have exchanged letters confirming the commercial terms of the deal," the company said in a press release, adding that Udmurtneft assets were being sold as an operating enterprise.

The deal is expected to be clinched in the near future, after final details are ironed out and a sale contract signed.

"The Federal Antimonopoly Service has okayed the deal," the company said.

The Russian anti-monopoly watchdog allowed ten Russian and foreign firms to bid for a controlling interest in Udmurtneft.

The list included Sibneft, which was renamed Gazprom Neft in May; Russneft; and Kazakhstan's KazMunaiGaz; along with other firms including Austria's OMV and Hungary's MOL.

Gazprom Neft said Monday it could make a joint bid with Hungary's MOL to take control of Udmurtneft.

Udmurtneft, which has annual oil production of some 6 million metric tons (120,500 bbl/d), is currently developing 26 oil fields in the region. The company has charter capital of 3.56 million rubles (about $130,000), divided into 2,671,549 ordinary and 890,517 preferred shares, each with a face value of 1 ruble (about $0.03).

During preparations for the tender, Deutsche Bank, which acted as a consultant to TNK-BP on the sale of Udmurtneft, became the nominal owner of 99.49% of Udmurtneft's common stock, and 88.99% of its preferred non-documentary shares.

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