Former YUKOS Owner Reorientated Business to Alternative Power Engineering

YUKOS principal holder, GML (former Group MENATEP), has evidently decided how to spend $655 million due to it after sharing the Mazeikiu Nafta money, Kommersant daily reported.

The funds will be funneled into alternative power engineering. As the oil business is not the prime interest of GML any longer, the company will focus mostly on Western Europe, avoiding Russia or CIS. GML could become a very promising investor, by the way; it is willing to get around $50 billion from Russia via the court.

GML won?t invest in the oil business but focus on the market of alternative power engineering, GML Director Tim Osborne told The Times yesterday. Osborne said they are thinking about the bio-diesel and wind-power engineering and are studying a few proposals.

Osborne said GML may funnel into alternative power engineering some portion of funds derived from the sale of Lithuanian Mazeikiu Nafta, if the court sustains its claims worth $655 million.

Under the award of the District Court of Amsterdam, the revenues derived from the sale of Mazeikiu Nafta (over $1.4 billion) will be shared by creditors with claims upheld by the Dutch court. The claims of Rosneft ($455 million) haven?t been confirmed yet, giving hope to GML that the debt could be settled in the end.

Moreover, GML intends to enforce on Russia the payment of quite sizeable amount via the UNCITRAL, The Hague. GML went to law February 2005, seeking compensation for devaluation of its share in YUKOS. The initial amount of the claim was $23.8 billion, but it should increase to $50 billion in view of the higher prices for crude oil, Osborne explained. GML will attract an independent appraiser that will specify the definite value and expects Russia to carry out its own evaluation and submit the results to the court. The first hearing of the case is slated for June 2007.