Rosneft Backs out of Russian Coal project due to inefficiency

Rosneft has decided to withdraw from the Russian holding Russian coal. According to Dmitry Panteleyev, a member of the oil company's press office, the decision came as 'a result of the project's inefficiency.' He added that 'we took this decision in order to cut down on our number of non-specialized shares. News of Rosneft's withdrawal has been sent to General Director of Russian Coal Vladimir Varshavsky.

In 2002 Rosneft bought a 50% stake in Russian Coal for USD 2.5 million. 'Legally we ought to be returned that sum which is still in the possession of the Russian Coal management,' said Mr Panteleyev.

However, as the press office stressed, 'it does not mean that Rosneft is pulling out of the coal industry altogether. We still have coal interests in Sakhalin which are unconnected with Russian Coal,' Mr Panteleyev said.

Both Rosneft and the International Industrial Bank own 50% stakes in Russian Coal. Rosneft first announced of its intention to back out of the project in November 2002 but then on December 4 of that year, the company confirmed that it would keep its 50% stake.

Russian Coal has the controlling stake in Gukov coal, a 75% stake in Rostov coal and also Far east coal which is currently filing for bankruptcy.

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