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Russia: Oil Company Privatization Could Raise $2 Billion

Moscow, 21 January 1998 (RFE/RL) -- Russian First Deputy Prime Minister Boris Nemtsov said today that the privatization of the Rosneft oil company could raise more than $2 billion for the state budget. But Nemtsov warned that the sale must be conducted "openly and cleanly," and that all potential bidders must be allowed to participate. Some in Moscow are suggesting that foreign groups might be barred from participating.

The price for Rosneft most frequently sited in the past has been about $1 billion. That was before the privatization auction was delayed at the end of last year. Rosneft is the last Russian oil giant that remains in state hands.

Three major consortiums have expressed interest in the firm. One is an alliance between Russia's Lukoil, the gas monopoly Gazprom and the British-Dutch group Royal Dutch Shell. Another joins Russia's Oneximbank and its oil subsidiary Sidanko with British Petroleum. The third consortium groups together Russia's private Rosprom with the oil firms Yukos and Sibneft.