MOSCOW, February 20 (RIA Novosti) Russia toughens stand on Iran /ONGC wants 49% in Sakhalin III/Government seeking new investor for Kharyaginsky deposit /Qatar wants to be Russia's partner in EADS/Foreign carmakers tempted by growing Russian market
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Nezavisimaya Gazeta
Russia toughens stand on Iran
Moscow has toughened its position on Iran two days before the expiry of a UN Security Council ultimatum ordering Tehran to suspend its uranium enrichment program.
On Tuesday, Russian authorities said they might stop supplying fuel for the Bushehr nuclear power plant because of Tehran's refusal to pay for fuel shipments.
That provides Moscow with a pretext for agreeing with the demands of the United States and other major powers, and to impose tougher sanctions on Iran.
As Iranian authorities have banned cash settlements in dollars, Russia's Central Bank now handles payments in euros. However, the Russian-Iranian contract stipulated dollar settlements.
"We cannot simply choose another currency without concluding an additional agreement," said Irina Yesipova, spokeswoman for Russia's nuclear vendor, Atomstroyexport, which is building the Bushehr NPP.
According to official Russian sources, the Bushehr project may face changes because Tehran is having trouble financing it.
But it appears that Russia has reached consensus with its partners in the Big Six, i.e. the United States, China, the United Kingdom, France and Germany, and can cite Iranian problems to justify the deal.
Moscow has been saving the fuel trump card for the last two years, and has completed just 80% of the Bushehr NPP since 2005.
Sources close to Russian-Iranian talks said Mahmoud Jannatian, deputy head of Iran's Atomic Energy Agency for power plants affairs, was asked last September to place orders for related equipment in Russia, but that Tehran had promised to independently expedite deliveries of such equipment.
"We do not believe Iran will complete the Bushehr NPP," a source close to Russia's Nuclear Power Agency said.
He said Tehran may refuse to cooperate with the International Atomic Energy Agency if additional sanctions are introduced, and that would make it impossible for Russia to continue with the Bushehr project.
Vremya Novostei
ONGC wants 49% in Sakhalin III
The management of India's Oil and Natural Gas Corporation (ONGC) has announced plans to acquire a 49% stake in the Russian Sakhalin III oil and gas offshore project.
However, it may face tough competition from other foreign companies, such as ExxonMobil or China's Sinopec. It may have to curb its appetite or else find a powerful Russian partner interested in foreign investment.
India imports about 95 million metric tons of crude annually, or 73% of its hydrocarbon consumption. As a result, its interest in the Kirinsky bloc, which has reserves of about 720 billion cubic meters of gas and 453 million metric tons of oil, to be developed under the Sakhalin III project, is easy to understand.
At present, ONGC has a 20% stake in Sakhalin I developed together with ExxonMobil and Rosneft. Perhaps, it can come to an agreement with the Russian state-owned oil major.
Sakhalin III may be put up for auction this year, after amendments to the law "On Subsurface Use" are adopted to restrict foreign companies' activities in Russian fields, the Russian Natural Resources Ministry said.
However, bids for an auction must be accepted three months in advance. That means that ONGC has to come to terms with a Russian company, set up a joint venture and submit its bid before October-November.
Such a short time period is only enough to reach an agreement with Rosneft, with which it has been in talks on different energy projects over the last three years.
Rosneft yesterday confirmed its interest in Sakhalin III, but declined to comment on the possibility of a consortium.
Given the terms of Rosneft's cooperation with China's CNPC within the Udmurtneft project, it is reasonable to expect that its terms for ONGC will be the same - the Russian company controls the JV, the foreign partner is fully responsible for financing, for which Rosneft pays with a share of the commodities produced.
Kommersant
Government seeking new investor for Kharyaginsky deposit
The Industry and Energy Ministry has circulated a memo among Russian oil majors to sound them out on whether any of them would like to take up a 20% option for the development of the Kharyaginsky deposit.
Industry experts think that state-owned Rosneft might exercise that option.
The deposit is one of three in Russia being developed under the terms of a production-sharing agreement (PSA). The other two are Sakhalin I and Sakhalin II.
The deposit is expected to produce 45 million metric tons in the 33 years of the agreement, which began in 1995.
The reassignment of 10% each from France's Total (which owns 50% of the project and is its operator) and Norway's Hydro (40%) is penciled into the agreements. A decision to pass 20% to LUKoil was made by the government in 2001.
The Ministry agrees that the choice of one more investor for the deposit has been too drawn-out "and needs to be solved at last."
LUKoil never exercised its right to join the project.
First, its operator was unable to agree on estimates with the Russian authorities. Then, environmental bodies started pecking at it, saying it was more than two-thirds short of the 3.5 million metric tons a year stipulated in the agreement.
At the end of 2006, LUKoil Vice President Ravil Maganov said that although his company was still interested in the project, it wanted the procedure for project management to be changed.
Analysts said the company will not buy the share in the deposit, and the likeliest client is going to be Rosneft.
"Investors in PSA projects have to operate in Russia under the close scrutiny of inspectors, and are vetted by anyone who takes the trouble," said Mikhail Subbotin, director of PSA Expertiza. "It is simply frightening to work under such agreements now."
The expert believes that the authorities have effectively demonstrated recently that they would like to see a more substantial holding in these projects going to state-run companies.
In Subbotin's view, the chemistry between government and state-operated firms will be less explosive should any problems arise.
Gazeta
Qatar wants to be Russia's partner in EADS
Not so long ago, Qatar and Russia were seen as potential partners in a gas analogue of OPEC. Now, the two countries have a new common interest.
As was announced yesterday, the Qatar Investment Authority, which manages over $40 billion in assets, is in talks on the purchase of up to 10% in the European Aeronautic Defense and Space Company (EADS), which owns Airbus.
The fund's head, Sheikh Hamad bin Jassem al-Thani, said the EADS stock was of special interest now, after several years of decline.
The corporation lost 19% last year alone, while its main rival, Boeing, posted a 25% increase in its capitalization. Almost 50% of the European corporation's stock is on the free float now.
It will not be profitable for Qatar to buy shares on the free market, experts said.
"It will take a long time to accumulate 10%, and it will push the price up," said Mikhail Pak, an analyst with the Kapital brokerage. "It is better to sign an agreement and buy the stake at a fixed price."
Being one of Airbus' biggest clients (Qatar Airways has ordered four super-giant A-380 and 60 A-350 planes), Qatar seriously hopes to buy into EADS.
However, "Europeans are not interested in giving large stakes to investors, especially from that region," said Oleg Panteleyev, head of analysis with the AviaPort agency.
Europeans have taken precautions to protect themselves against a potential takeover.
The corporation's articles of association envisage that only representatives of the two main blocs, the French and German ones, which hold 22.5% each, can be on its board of directors.
That is why Russia's VTB had to be content with only 5% of the corporation last year, although the Russian government wanted to get a blocking stake when setting up the Russian United Aircraft Building Corporation (UABC).
"That was obviously an unrealistic dream," Panteleyev said.
Vedomosti
Foreign carmakers tempted by growing Russian market
Nissan, Toyota, Volkswagen and its Czech division Skoda have all announced plans to develop inexpensive cars for Russia. If their plans are realized, at least four new low-budget models will vie with each other for Russian buyers by 2010.
Skoda General Director Detlef Wittig said the company will offer cars worth about 7,000 to 8,000 euros on the Indian, Chinese and Russian markets.
The new Skoda model could be assembled at a Volkswagen automotive plant, now under construction in Russia's Kaluga Region.
Previously, the company's top managers said the plant would produce modified Volkswagen Polo cars, worth up to 10,000 euros each.
In January, global auto giants Nissan and Toyota said they plan to develop cheap cars for the Russian market. The Toyota model will cost $6,000-7,000, while Nissan declined to cite a price.
Most Russians are not rich enough to afford expensive cars, Toyota Russia spokeswoman Tatiana Rusakova told the paper.
Nissan Russia spokeswoman Tatiana Natarova agreed that cars costing under $10,000 are very popular in Russia, as sales of the Renault Logan prove.
In 2006, Renault Russia sold 49,323 Renault Logan cars worth $9,500 each, from the Moscow-based Avtoframos plant, and plans to turn out 160,000 vehicles per year by 2009.
Independent automotive market expert Valery Tarakanov said 600,000 cheap cars, worth $10,000-15,000, will account for 20% of the Russian market by 2010.
He said foreign carmakers cannot assert themselves on the Russian market unless they offer inexpensive vehicles.
Cheap cars are needed to compete with Asian automakers, including numerous Chinese companies, India's Tata Motors, Iran's Khodro and Proton of Malaysia, Tarakanov said.
