Gazprom Neft Seeks to Expand Overseas

As reported by The Silk Road Intelligencer, Gazprom Neft – a subsidiary of Russian natural gas monopoly Gazprom – had initiated talks to acquire a 49 percent stake in Mangistaumunaigas (MMG), a Kazakh oil company, according to Russian media.  As the article notes:

“…The deal is a part of Gazprom Neft’s strategy to expand overseas and grow its production and refining businesses.

Russian energy analysts believe that the main prize for Gazprom Neft is the Pavlodar refinery, currently controlled by MMG. The refinery is connected by a pipeline to the Gazprom Neft-owned Omsk refinery and oil fields in Western Siberia, making it a strategic asset for the Russian oil company. With guaranteed supplies of Western Siberian crude, Gazprom Neft could operate the refinery at full capacity of 7.5 million tons of crude a year. Currently, the refinery operates at about 60 percent due to lack of access to suitable crude.

Furthermore, Gazprom Neft is interested in acquiring MMG’s retail network of Helios gasoline stations which would allow it to develop its retail presence in Central Asia.

Observers value MMG at around $4.5 billion making the price tag for Gazprom Neft’s stake $2-2.5 billion.

Earlier this year, KazMunaiGas, the Kazakh national oil company signed a memorandum of understanding with Central Asian Petroleum, the current owner of MMG about acquiring a majority stake in the company.”

This entry was posted on Saturday, July 12th, 2008 at 12:18 am and is filed under Gazprom, Kazakhstan, MangistauMunayGaz, Russia.  You can follow any responses to this entry through the RSS 2.0 feed.  Both comments and pings are currently closed. 

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