Lukoil Executive: Russia Unlikely to Sell Large Rosneft Stake Soon

MOSCOW - The Russian government is unlikely to sell a large stake in state-controlled oil giant OAO Rosneft in the near future and won't give up its dominant position in the energy sector, the deputy chief executive of Russia's biggest non-state oil producer, OAO Lukoil Holdings, said Thursday.

"The state will continue to dominate in the sectors of the economy where it can," Leonid Fedun told the Sberbank Russia Forum 2013.

He added that the current situation in the oil sector reminds him of the mid-1990s, when there were only two sizeable oil companies in Russia: a state-owned one and Lukoil.

The past decade has witnessed the forced bankruptcy of what was once the largest oil producer, OAO Yukos; the takeover of OAO Sibneft by state-owned natural-gas firm OAO Gazprom; and, last month, the acquisition of TNK-BP by Rosneft.

Mr. Fedun said the state will dominate the market until 2018-2019, when it may be faced with falling oil output and will start seeking to improve the management of the companies.

Russian Economy Minister Andrei Belousov said in April the state may reduce its stake in Rosneft by roughly 19% from 69.5% now. Rosneft Chief Executive Igor Sechin opposes the plan.

Copyright (c) 2012 Dow Jones & Company, Inc.


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