Rosneft-Gazprom merger mechanism approved

The structure of the merger between state-owned oil company Rosneft and natural gas giant Gazprom has been finalized, Gazprom said Wednesday but a former Yukos subsidiary will not be part of the deal.

Gazprom spokesman Sergei Kuprianov said the date for the merger hadn't been set yet.

Kuprianov said the former core subsidiary of the embattled Yukos oil company Yuganskneftegaz which was sold off against its parent company's crippling back tax bills, would not be included in the combination.

The merger, which would create a national energy behemoth to rival Saudi Arabia's Aramco, is aimed at increasing the state's stake in the world's biggest gas producer to a controlling 51 percent, opening the way for reforms that would give foreigners access to the gas giant's shares.

The merger had been delayed after a Houston bankruptcy court initially banned a December auction that saw Yuganskneftegaz sold to a shell company that was later bought by Rosneft.

The Houston court threw out Yukos' bankruptcy filing last week, however, removing fears that Russia's most strategically important company could see its exports and cash flows frozen by merging with the owner of a litigious asset.