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Russia to focus on Rosneft sale after Bashneft delay

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Staff Writer | August 18, 2016
Igor Shuvalov
Energy business   First Deputy Prime Minister Igor Shuvalov:

The Russian government will consider the privatization of oil company Bashneft again only after the sale of a stake in major oil producer Rosneft, First Deputy Prime Minister Igor Shuvalov told reporters.

“The sale of Rosneft is now coming to the foreground. We must focus on this. After selling the stake in Rosneft, we will come back to the sale of Bashneft because we already have a presidential order on privatization of the company,” Shuvalov said.

Press secretary of Prime Minister Dmitry Medvedev Natalya Timakova said that the head of the government had decided to postpone the privatization of a 50.08% stake in Bashneft past 2016 and President Vladimir Putin was supportive of the decision.

Shuvalov said that the sale preparation has revealed a significant investor interest in the asset and that some real contenders have shown up. “There are real contenders and we understand what is the price they want to buy Bashneft for. We are studying the position of the Bashkortostan republic so that this asset can be sold more successfully.”

Rustem Khamitov head of the Bashkortostan republic, which holds 25% in Bashneft, said that the regional government is not considering selling its interest in Bashneft.

The Finance Ministry does not plan to raise borrowing because of the postponement of Bashneft privatization, Deputy Minister Sergei Storchak said.

Business daily Vedomosti reported that the 2016 Russian budget includes an assumption that Bashneft will be privatized and without it budget reserves will be depleted by the end of December.

Storchak said, “This is not connected in any way.”

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