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Rosneft in the Media

Sechin: Rosneft plans in Italy

24 October 2014

Number One of Rosneft: “EU sanctions? They’re wrong, but do not change our plans”

“Is Rosneft used to boss around?” It is out of his character, but when Igor Sechin is asked about Italian Pirelli and Saras, and speculations about increasing Russian involvement in these companies, he gets rattled. “We are an international public company, which doesn’t rule, but follows the market rules.” “We are listed on the London Stock Exchange, BP owns 19.5% of stocks, and such funds as Blackrock and Fidelity are among our partners,” he adds. Thereby Russian Rosneft (state-owned by 70%) claims it has no hegemonistic ambitions towards Angelo Moratti’s Saras and Marco Tronchetti’s Pirelli. It is quite the contrary, the doors are open for Pirelli to invest in “petroleum refining industry sector in Vladivostok”. “We will know in advance when Tronchetti leaves, and will prepare our own plan of actions,” Sechin says.

It is kind of impressive to hear Rosneft head and Putin’s right-hand man convincing the market as an ‘ordinary’ western oil worker. When a few years ago Exxon was expelled from Venezuela, President of the Company Rex Tillerson pointed at ‘sanctity’ of contracts. Sechin did the same thing in the past. Now, under pressure of western sanctions, he goes back to this topic. “Contracts must not fall under political leverage,” he said at the Eurasia forum in Verona (the event is organized annually by Antonio Fallico, Chairman of the Board of Directors of Banca Intesa in Russia). Oil investment cycles last 30 years, this period is significantly wider than instantaneous political concerns. Therefore, the decision of European Union from July, which prohibited Russian legal entities and individuals to require performance of contractual law, is very contradictory. Now, he continues, the company doesn’t suffer from credit cutback and embargo on technology. Rumor has it that National Welfare Fund may render aid amounting to 48 billion dollars, as bonded loan. There is no clarity yet. Sechin explains that meanwhile “Rosneft financial condition is stable. It allows to continue investment programs easily, and to honor our loan commitments according to schedule.” He optimistically adds that there’re no problems regarding the fall in oil prices either (“in 2 years it will come back to the level of 100 dollars”). Moreover, there’s no question concerning the company’s ability to keep the rate of production at 5.1 million barrels (two times more than in Iraq). “We can keep this level within 20 years even not discovering new fields”, he answers.

Given the situation, what is the status of strategic agreements with Eni?

Sechin explains that actions of the Italian company are obviously limited by sanctions against Russia, but Eni is still trying to obtain “necessary licenses for legal cooperation with Rosneft” in the Barents and Black seas. “If they do not succeed, we will continue works by ourselves. Eni will have an opportunity to come back, when they are able to resume cooperation.” In case of cooperation with Saipem, Igor Sechin “widely opens the doors” (“We need to drill over 90 platform wells”).

Is there interest to the company, which Eni doesn’t consider strategically important?

Not now, but “when this offer comes into the market, we’d think about it.” These words caused fast growth of oil service company shares.

Currently there’re no thoughts regarding cooperation with Eni (which experienced major issues with complexes in Gela and Leghorn) in the region of oil refining. “We have no joint refining projects with Eni,” Rosneft head noted briefly.

What about participation in capital stock of the six-legged dog (Eni logo) in case Italian government puts up for sale its 5% of shares?

Nothing that I can put my finger on. “Tell Descalzi that Russian government also wants to cut its share in Rosneft,” Sechin said smiling.

Are there any other companies besides BP considering to buy into Rosneft?

“Any company that acknowledges the correct share price, which is not less than $8.12 per share, the amount paid by other investors in similar situation,” Sechin said.

Sechin: i piani di Rosneft in Italia

Corriere della Sera
October 24, №252
Author: Stefano Agnoli