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Article Excerpt
IN BRIEF
Interfax turns 20!
MOSCOW. (Interfax) - Interfax turned 20 on September 9. These 20 years are the same that make up the history of modern Russia. In this very period, radical changes have occurred in the country's system of government, its politics, economy, culture, and in people's everyday lives.
Interfax has also changed over this time by significantly expanding its scope and the area of its activities.
Interfax today is a group of 36 companies, and an acclaimed leader on Russia's information market that enjoys respect all over the world.
However, it is also important to point out what has not changed about Interfax.
We are not ashamed to read our news written over these twenty years, because we have always strived to meet the highest standards of independent journalism, to report news promptly and accurately, to remain impartial, and to seek exclusivity.
Interfax made its name in news that radically changed the country. From the 500 Days Program to the 1991 Communist coup, from the breakup of the Soviet Union to the establishment of the CIS, from the war in Chechnya to the August 2008 conflict in the Caucasus, and many more besides, all are events which people first learned about from our newswires and have now become part of history.
While Interfax started out as a political news agency, it has since exceeded the limits of news journalism and now provides virtually every kind of business information needed by banks, companies, and investors to successfully work on the markets.
Interfax has formed Russia's first national network of regional news agencies and has agencies in every federal district. It has also developed industry-specific agencies specializing in oil, gas, energy, and financial information. Interfax news agencies in Ukraine, Belarus, Kazakhstan, and Azerbaijan all occupy leading positions on the news markets in each country.
Interfax Group's largest information project abroad is the Interfax-China news agency, which is currently the largest foreign media outlet in China.
Interfax's distribution companies in the U.S., the United Kingdom, Germany, Hong Kong, and Poland have direct contacts with thousands of clients, among them major international media outlets, government institutions, international corporations, and banks.
Interfax Group incorporates a number of specialized structures developing search databases and providing IR (Investor Relations) and disclosure services. Among them are the Interfax-Corporate Information Agency, which operates the biggest corporation information database in Russia, SPARK, which covers over 12 million companies from Russia, Ukraine, and Kazakhstan, and the Center of Economic Analysis, a leading analytical company in Russia and the CIS reporting rankings of banks and insurance companies under the Interfax-100 and Interfax-1000 brand names.
Interfax has set up a chain of press centers that has no equivalents in Russia or the CIS, which comprises 30 press centers in Russia, Ukraine, Kazakhstan, and Azerbaijan.
Interfax Group cooperates productively with global business giants. For instance, Moody's Interfax Rating Agency set up by Interfax and Moody's Investors Service, a global leader in the rating business, is the leader on the Russian rating services market.
At the end of 2004, Interfax started actively developing the credit history market, a business that was not only new to the company but to the Russian market in general, by setting up a joint venture called Experian Interfax with Experian, one of the world's leading credit bureaus. Experian Interfax is one of the top three credit bureaus in Russia.
Since 2006, the global information giant, Thomson Reuters, has been Interfax's strategic partner in Russia in providing IR services.
The Interfax-D&B joint venture set up by Interfax on a parity basis with the global corporation Dun & Bradstreet started operations in 2008. Interfax-D&B provides international clients with information on Russian companies based on the SPARK database.
However varied Interfax's areas of activity are, we continue to strive to meet the highest quality standards in all of them, with key emphasis placed on verification of information.
"We respect society's right to know truthful information and do all we can to make this information available to it," Interfax's Charter says.
We will work hard to make sure that this continues.
IN BRIEF
Editor's Choice
*** The Federation Council announced this week that the license to the giant Sukhoi Log gold field in the Irkutsk region will not be allocated this side of 2010, as the Council's Natural Resources and Environmental Protection Committee has yet to reach a decision on how the license will be allocated. The current favored method is either a tender among Russian companies, possibly with some foreign capital, or direct government selection. The Council would like to see an investor enter the project sooner rather than later, but fears Russian companies might not be able to mobilize the investment needed to develop the field in the current crisis conditions. The field is one of two metals deposits included on the government's list of strategic deposits and cannot therefore be developed by a foreign entity as a primary investor.
*** Russian uranium holding ARMZ said this week that it expects the slump in prices for uranium will soon reverse. ARMZ also said that it expects to call a tender to find a contractor for the Elkon project in Yakutia before the end of 2009 and that it expects to wrap up talks with its main potential partners in a uranium project in Mongolia by mid-2010. ARMZ is also discussing a uranium project in Ukraine and is looking at possible cooperation regarding Africa-based uranium assets with France's Areva.
*** Oleg Deripaska told the Vedomosti newspaper this week that his Basic Element holding could sell its stake in oil producer RussNeft for deleveraging purposes. Deripaska's RUSAL, the world's largest producer of aluminum and alumina has been particularly hard-hit by the global financial crisis, and other group members, such as GAZ, which this week lost a 1 billion-ruble suit against steelmaker NLMK, are also struggling. BasEl is negotiating to try and restructure almost $20 billion in debt and aiming to clear all debt in the next few years and could bring a partner in or sell off top-ten producer Russneft completely. BasEl has effectively controlled the oil producer for more than two years, since reaching an agreement to buy if from its previous owner, Mikhail Gutseriyev. The acquisition has not yet formally been closed as BasEl has not yet obtained clearance from the government's commission for control over foreign investment.
*** VSMPO-Avisma said this week that it is stretching the timeframe for its investment program, which was originally due to be completed by 2012, until 2015 to ease pressure on the company. The world's biggest producer of titanium said all of the goals, resources and methods approved in the original program remain in force, and that $635 million of the targeted $1 billion of investment had been absorbed. The program mainly involves the acquisition of equipment to complement existing capacity. The biggest projects are the Ural Boeing Manufacturing joint venture; and new skull melting furnaces and housing for these, which will produce ingots from titanium waste and which will be commissioned in 2011.
*** Russian steelmaker MMK this week announced that it closed Q209 at a profit. MMK expects output in Q3 2009 to soar 35% from Q2 and to be operating at full capacity in September. MMK expects to boost third quarter revenue 50% on Q2. It said the domestic market remained its priority. Total debt continued to decrease in Q2 while short-term debt fell 20% due to the early repayment of loans to Russian banks. MMK reached agreement with Sberbank Russia this week to reduce the interest rates on existing credit lines.
*** Moody's Investors Service this week warned that the Russian steel sector continues to face high indebtedness on the back of past acquisitions. In a special comment, it said that liquidity concerns will continue to challenge otherwise profitable domestic operations. Russian companies' desire to purchase global assets is now hitting them hard due to debt and market weaknesses. However, it said that strong self-sufficiency and the possible recovery of the domestic market will help their profitability. Meanwhile, UralSib Capital said Russia could produce 10%-15% more steel than forecast in 2009 if the country's main steel producers are able to sustain the production levels seen in August, when capacity was running at approximately 100%.
*** The commission for sustainable economic development this week approved 30.75 billion rubles in state guarantees for members of Alisher Usmanov's Metalloinvest holding. The guarantees go to iron ore producers Lebedinsky GOK and Mikhailovsky GOK and steel producers Oskol Electrometallurgical Combine and Urals Steel. The commission took the VTB bank's opinion that the Metalloinvest units are capable of honoring their loan commitments into consideration and will secure a VTB credit facility to be used for operating purposes and to fund capex.
PRECIOUS METALS
Sukhoi Log gold field won't be licensed before 2010 - legislator
IRKUTSK. (Interfax) - The license to the giant Sukhoi Log gold field in the Irkutsk region will not be allocated this side of 2010, Viktor Orlov, chairman of the Federation Council's Natural Resources and Environmental Protection Committee, told reporters in Irkutsk.
Orlov said a decision still had to be reached on how the license will be allocated. "A tender among authoritative Russian companies, maybe with some foreign capital, would be the best option. Either that or the government selecting the investor directly," Orlov said, adding that he was "an advocate of the speedy licensing of Sukhoi Log."
However Russian companies might not be able to mobilize the investment needed to develop the field in the current crisis conditions, he said.
Orlov said that subsurface resources legislation and the Tax Code would have to be amended if the government itself selects the investor. He said the Irkutsk region, which is the party most interested in getting Sukhoi Log into production, might make the legislative initiative.
A feasibility study for Sukhoi Log projects a recoupment period of 12 years for the project.
Sukhoi Log contains just under 2,000 tonnes of recoverable gold at present, but follow-up exploration during the course of the project could increase these reserves to 2,600-2,700 tonnes. A mine at the field could cost 49 billion rubles to build and produce up to 50-60 tonnes of gold per year in time. It would have a life of 30-40 years.
PRECIOUS METALS
Polyus Gold estimates Verninskoye gold project investment at 7.6 bln rubles
IRKUTSK. (Interfax) - Polyus Gold estimates investment in the Verninskoye field in the Irkutsk region at 7.6 billion rubles, Sergei Karabutov, the No.1 Russian gold producer's government liaison officer, said at a roundtable on a development strategy for the region's mineral resources.
Karabutov said a gold recovery plant at Verninskoye would be capable of producing approximately 6 tonnes of gold per year in 2013.
Polyus Gold's Lenskaya Gold Company started to build the plant in 2006. The plans for developing Verninskoye stated that the plant would be processing 1.6 million tpa of ore per year in 2010, rising to 2.2 million tonnes in 2011, and that it would be producing 4.8 tonnes of gold in 2010 and 6.4 tonnes in 2011. Investment in the project in the period 2005-2011 was estimated at 5.4 billion rubles, not including the license acquisition and follow-up exploration costs, or VAT.
Karabutov also said that the options under consideration for the Chertovo Koryto gold project, also in the Irkutsk region, included building a recovery plant with throughput capacity of 2.2 million-4 million tonnes of ore per year.
The company originally planned to start developing Chertovo Koryto, which holds an estimated 100 tonnes of gold, in 2009.
Karabutov said Polyus Gold was interested in acquiring licenses to fields containing 50-100 tonnes of gold, preferably on a competitive basis.
He also said Polyus Gold subsidiary Lenskaya Gold Company could spend more than 345 million rubles on exploration in the Irkutsk region this year, the bulk of it - 229.4 million rubles - at properties adjacent to the Verninskoye and Chertovo Koryto fields.
Lenskaya Gold Company invested 665.6 million rubles in hard rock gold exploration in 2006-2008, growing reserves by 77 tonnes, he said.
The company aims to keep to its strategy of sustaining placer gold production volumes at last year's level (5.7 tonnes).
As of the start of 2009, the company's commercial placer gold reserves in the Irkutsk region totaled 69.5 tonnes, and off-balance reserves were 23.3 tonnes.
Polyus Gold's annual capital expenditure at placer deposits is approximately 300 million rubles. Around half of this is spent on new equipment and a third on exploration.
PRECIOUS METALS
Polymetal shareholders have until Oct 8 to exercise preemptive rights on shares
MOSCOW. (Interfax) - Shareholders in Russia's top silver producer Polymetal may exercise their preemptive rights to buy new shares until October 8, the company said in a statement.
The company is issuing 84.375 million ordinary shares for a private placement. Shareholders who oppose the placement or did not vote at the June 19 extraordinary meeting, have the right to buy new shares in proportion to their holdings as of May 14, 2009 at 278 rubles per share.
The supplementary issue amounts to 26.8% of pre-placement charter capital.
Polymetal will use the placement proceeds to finance deals concluded at the beginning of the year. It is placing up to 7.5 million shares for the acquisition of Ayaks, up to 10 million shares to acquire Sopka Kvartsevaya, and up to 66.875 million shares in favor of OJSC Polymetal Management Company, as well as any existing shareholders that wish to exercise their preemptive rights.
Since the start of the year, Polymetal has announced several asset purchases for which company stock could be used as payment. In particular, Polymetal acquired Ayaks from Ovoca Gold in January 2009. Under the terms of the acquisition, Polymetal received 4,166 shares in Ayaks (10.4% of charter capital) and a third party received 35,934 shares (89.6%). In exchange for this stake, Polymetal plans to place 7.5 million supplementary shares.
The company has also agreed to acquire the Sopka Kvartsevaya gold-silver deposit from Lev Levaev's group of companies for 10 million ordinary shares. In addition, Polymetal has acquired a 9% stake in Gold Ore Company Mayskoye LLC from a subsidiary of Highland Gold and could purchase the remaining 91% stake in exchange for either $95.55 million or 15.925 million of its shares.
A source at the company said earlier that the shares acquired by Polymetal Management Company during the additional placement could subsequently be sold to the market.
PRECIOUS METALS
Darasun stoppage drives Trans-Baikal gold production...
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