Russian State Duma Opposes Sale of Slavneft Stake to Chinese Company

The Russian State Duma has expressed its opposition to the participation of foreign companies in the December 18 auction for a stake in Slavneft. According to Rosbalt's correspondent, Duma deputies passed a resolution to this effect yesterday.

The resolution notes that according to current legislation, state and municipal property can be bought by any person or company, with the exception of state and municipal unitary companies, and also companies in which the Russian Federation, a region of the Russian Federation, or a municipal authority have a stake of over 25%. The State Duma believes that the ban should be extended to include foreign companies in which a foreign state has a stake of over 25%. According to the deputies, 'the Russian government should bring its privatization auctions in line with this restriction.' The resolution was sponsored by the Russia's Regions party and was passed by 255 votes to 63.

The Duma resolution follows an announcement at the end of November by the Chinese state-owned company China National Petroleum Corporation (CNPC) that it intends to take part in the auction for a 74.95% stake in the Slavneft oil company. According to analysts, CNPC would be able to pay twice as much for Slavneft as any Russian company. China National Petroleum Company extracts 40 million tonnes of oil per year in China. It also holds assets in Sudan, Azerbaijan and Kazakhstan, where it extracts 16 million tonnes of oil a year.

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