Russian Government Backs Tyumen Oil's Privatization; Company Predicts Ruling Will Boost Investor Confidence

Apr 20, 2001, 01:00 ET from Tyumen Oil

    MOSCOW, April 20 /PRNewswire/ -- The Russian government's Audit Chamber,
 an independent body that oversees Russia's federal budget, ruled today that
 Tyumen Oil's 1999 privatization was legal and that the sale price was
 appropriate and well-founded.  Tyumen Oil, one of Russia's top four oil
 companies, said the decision should give fresh confidence to investors and
 business partners in the company's business practices.
     The Audit Chamber, whose representatives are appointed by Russia's Duma,
 president and Federation Council, said its more than two-month investigation
 concluded that a privatization auction held Dec. 22, 1999, complied fully with
 Russian laws.  It also said that the price paid for the government's stake in
 Tyumen Oil was fair and that all investment conditions had been met.
     "We are pleased that, as we expected, the Audit Chamber's thorough
 investigation has confirmed the propriety of the privatization and expect that
 this ruling will reassure investors and business partners about the fair,
 transparent and legal way in which we do business," said Joseph Bakaleinik,
 Tyumen Oil's chief financial officer.
     New Priorities, a company formed by Tyumen Oil's shareholders, won the
 auction for the government's 49.8 percent stake with a bid of $90 million,
 plus a requirement to invest $185 million in the company. The investment was
 spent on a first stage of modernization of Tyumen Oil's principal oil
 refinery, at Ryazan, Russia, and rehabilitation of oil wells and pipelines in
 the giant Samotlor oil field in Western Siberia.  The Russian Federal Property
 Fund certified in February of this year that Tyumen Oil had fulfilled the
 investment requirement and transferred the government's shareholding to the
 company's private owners.
 
     Tyumen Oil, established in 1995 and owned by the Russian Alfa Group and
 US-Russian Access/Renova, has proven crude oil reserves of more than
 8.2 billion barrels and produces more than 800,000 barrels of crude oil per
 day.  It ranks No. 2 in reserves and No. 4 in production among Russian oil
 companies, and was named the world's "Best Oil and Gas Company" of 2000 by
 Financial Times Energy.  Tyumen Oil owns and franchises a chain of nearly
 1,000 branded retail gasoline stations in Russia.  For further information,
 visit www.tnk.ru .
 
 

SOURCE Tyumen Oil
    MOSCOW, April 20 /PRNewswire/ -- The Russian government's Audit Chamber,
 an independent body that oversees Russia's federal budget, ruled today that
 Tyumen Oil's 1999 privatization was legal and that the sale price was
 appropriate and well-founded.  Tyumen Oil, one of Russia's top four oil
 companies, said the decision should give fresh confidence to investors and
 business partners in the company's business practices.
     The Audit Chamber, whose representatives are appointed by Russia's Duma,
 president and Federation Council, said its more than two-month investigation
 concluded that a privatization auction held Dec. 22, 1999, complied fully with
 Russian laws.  It also said that the price paid for the government's stake in
 Tyumen Oil was fair and that all investment conditions had been met.
     "We are pleased that, as we expected, the Audit Chamber's thorough
 investigation has confirmed the propriety of the privatization and expect that
 this ruling will reassure investors and business partners about the fair,
 transparent and legal way in which we do business," said Joseph Bakaleinik,
 Tyumen Oil's chief financial officer.
     New Priorities, a company formed by Tyumen Oil's shareholders, won the
 auction for the government's 49.8 percent stake with a bid of $90 million,
 plus a requirement to invest $185 million in the company. The investment was
 spent on a first stage of modernization of Tyumen Oil's principal oil
 refinery, at Ryazan, Russia, and rehabilitation of oil wells and pipelines in
 the giant Samotlor oil field in Western Siberia.  The Russian Federal Property
 Fund certified in February of this year that Tyumen Oil had fulfilled the
 investment requirement and transferred the government's shareholding to the
 company's private owners.
 
     Tyumen Oil, established in 1995 and owned by the Russian Alfa Group and
 US-Russian Access/Renova, has proven crude oil reserves of more than
 8.2 billion barrels and produces more than 800,000 barrels of crude oil per
 day.  It ranks No. 2 in reserves and No. 4 in production among Russian oil
 companies, and was named the world's "Best Oil and Gas Company" of 2000 by
 Financial Times Energy.  Tyumen Oil owns and franchises a chain of nearly
 1,000 branded retail gasoline stations in Russia.  For further information,
 visit www.tnk.ru .
 
 SOURCE  Tyumen Oil