Speaking at the Renaissance Capital investment conference, Rosneft Vice President for Finance Peter O?Brien declined to say whether it would seek a premium to other Russian oil companies such as market leader Lukoil , which has a market capitalisation of about $58 billion. Rosneft will have to consult with its bankers and advisers, he added.
But during his 15-minute speech, O?Brien presented Rosneft as a future market leader, implying it would justify a premium to Lukoil and Russia?s second-ranked TNK-BP. ?The management will be working for all shareholders ... We?re targeting leadership by 2010,? O?Brien said. ?We are today very net-back and cash-flow focused. Rosneft is the world leader in proved reserves and reserve life. We have abundant growth opportunities, and we are growing faster than any of our peers. We are also present in strategic oil provinces such as Sakhalin and East Siberia.?
Asked what comfort he could offer future shareholders with respect to the risk of litigation, he said Rosneft?s legal teams in Moscow and abroad were confident the legal track-record was positive. Shareholders in stricken oil company Yukos have promised ?a lifetime of litigation? for Rosneft because of its purchase of Yuganskneftegaz, once Yukos? core production asset. Yukos now faces collapse because of $33 billion in back-tax claims. The state put Yugansk up for auction in late 2004 to help pay back tax claims, which Yukos said was a political move to break the company. Yugansk fetched $9.4 billion.
