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31

Russian Oil Companies on a Merger Spree

Russian Oil Industry looks like the country's major oil firms will continue to merge over the next few years until only one or two world-scale players remain. "I'm hoping that one of those will be ours," said Mikhail Khodorkovsky, chairman of Yukos, one of the largest Russian oil company.

Russian Oil Industry looks like the country's major oil firms will continue to merge over the next few years until only one or two world-scale players remain. "I'm hoping that one of those will be ours," said Mikhail Khodorkovsky, chairman of Yukos, one of the largest Russian oil company.Most of Russian oil companies are entering globalisation era expecting acquisitions to continue in the country as Russian oil companies search for new markets.Yukos, one of the busiest Russian oil companies in acquisitions, recently tried to increase its stake in another Russian concern, Eastern Oil Co., but was blocked by the government.Another Russian oil company, TNK, has been courting Western companies, especially BP to form a strategic partnership. The two companies hold stakes in Eastern Siberia's Russian Petroleum.
Sibneft has just signed an agreement with Halliburton, the second-biggest oil services provider, to service Russia's No. 6 oil producer's fields in Siberia to help the company to boost output by over a quarter this year.
There continues to be a role for Western companies in Russia, noting that New York-based Schlumberger and Dallas-based Halliburton are the only ones offering a full range of services working in Russia and more service companies could be doing business there. Russia's oil industry is struggling with low oil prices due to a glutted domestic market, which is driving takeovers. Mergers are seen as a way to become stronger and more able to survive.The glut of domestic oil production has caused the Russian government to consider for the first time creating a 37-million-barrel crude reserve similar to the U.S. Strategic Petroleum Reserve in order to alleviate the oversupply.As Russia's oil companies grow, they are assuming a larger role in world oil markets. Since Russia's stand-off with the Organization of the Petroleum Exporting Countries late last year over production cuts, Russian oil companies have increased their influence beyond their country's borders.




Author: Zhanna Belyaeva

Source : Neftegaz.ru