Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Ian Renert – the whole truth and nothing but the truth
This is Ian Renert. I was the fund manager for a Bahamian family of funds organised in 1997. BDO International served as both our accountants and auditors. [BDO International is the 5th largest accounting firm in the world]. The Bahamas office of the Firm illegally forced us into receivership under their control on 7th June 2000 and used this opportunity to bury their culpability and that of their Isle of Man operation. While they were at it, they invoiced us for millions of dollars, thereby stealing millions of dollars of our assets in what they claimed would be a 'protective receivership.' Through my efforts and that of our lawyer, Maurice Glinton of Freeport, Bahamas - whom I found - we were successful in overturning the receivership, suing and winning lawsuits against BDO and our former lawyers in 2004 (Callender's & Co. conspired with BDO to create the illegal receivership). Thankfully we received justice through the courts in the Bahamas. It is too bad that the SEC decided to make me into the fall guy and totally excluded all evidence of what the BDO organisation did in their involvement as both our accountants and auditors. It is frightening that such an occurrence is possible within the U.S. legal system.
Most investment managers would have walked away from their clients as soon as they stopped receiving their paychecks. However, I have continued to work for my clients for nearly five years since receiving my last one. My goal is for my clients to receive the value stated on their last statement plus damages, and if that happens, I shall feel as though we were successful in our efforts.
Shame on you BDO International and the SEC!
Ian Renert
Procurement by RAO UES Entities Tops RUB300 bn in 2004
Moscow, 10 February 2005. The value of procurement by enterprises of RAO "UES of Russia" in 2004 was in excess of RUB300 billion. The savings achieved as a result of the use of competitive procurement totalled RUB3.3 billion, a nearly threefold increase on 2003.
The main procurement method used by the energy companies is competitive tendering, with special emphasis placed on public tenders. In 2004, RAO UES enterprises held nearly 9,000 tenders, which is two times the 2003 figure. The share of competitive procurement grew to 45.5%.
One of the principal areas for the development of the competitive procurement system at RAO "UES of Russia" is the expansion of e-business systems. In October 2002, RAO "UES of Russia" initiated the development and launch of an e-trading system, Goods, Services and Technology Markets for Electricity Industry - B2B-Energo, which now has over 2,600 participants from Russia and 22 countries of the world.
Trading in the B2B-Enego helps RAO UES entities reduce their procurement costs by at least one third, and cut the price of the goods, works and services procured by 9%. Price of the products procured through e-auctions is reduced by an average of 17% and, in some cases, by more than 40%.
For example, in 2004 OAO Neporozhny Sayano-Shushenskaya HPP procured goods worth over RUB300 million through e-trading systems, achieving savings of more than RUB30 million. Thanks to the use of B2B-Energo, OAO Penzaenergo was able to save RUB70 million in 2004.
The use of e-procurement is one of the factors, which make it possible to curb the heat and electricity price rise in different regions of Russia.
In view of the successful experience of using e-business mechanisms in procurement activities, the Management Board of RAO "UES of Russia" decided that at least 50 percent of goods, works and services procured by RAO UES entities should be purchased through e-trading systems on a competitive basis.
___________________________________________________________
The system for competitive procurement of goods, works, and services has existed at RAO "UES of Russia" Holding Company since 1999. The system is intended to improve the manageability of cash flows, enhance transparency of spending, and reduce energy companies' expenses.
The Information and Trading System "Market for Goods, Services and Technologies for the Electricity Industry - Â2Â-Energo" (website: www.b2b-energo.ru) offers expanded functionality for the information support, marketing and organization of various e-procurement processes in an online mode.
According to experts, the estimated savings from the use of e-business systems by RAO UES enterprises may total more than RUB11 billion in the next three years.
Khristenko: UES Sales May Not Start Until '06
By Lyuba Pronina
Industry and Energy Minister Viktor Khristenko on Wednesday brushed off investor concerns that UES reforms had been shelved, but admitted that the eagerly anticipated privatization auctions for the power monopoly's choicest assets will not happen anytime soon.
The Cabinet was scheduled to finalize a privatization plan for UES' generating assets and other details of the industry's restructuring on Dec. 2. On Monday, however, the meeting was postponed until Dec. 16, and Tuesday it became known that privatization was taken off the agenda.
"There is nothing negative about what is going to be discussed at the government meeting," Khristenko told reporters after a meeting of a government commission on energy reforms.
Nonetheless, Khristenko said preparing the assets for sale could take until the middle of 2006, seeming to confirm market fears that no auctions will take place next year.
"It just means that the goods will be sold when it is clear where they will be sold, on what bazaar it should be done," Khristenko said, referring to the 10 wholesale generation companies, known as OGKs, that are being created from the more than 70 UES generating assets. The six that will be auctioned off are considered the cornerstone of sector reform.
"The issue is when, what and under what conditions. The talk now is about [how] ... they have to be prepared and packaged," he said.
Media reports Tuesday about the delay sent UES shares down as much as 5 percent. Industrial groups have been buying up UES shares in anticipation they will be able to use them as currency in the auctions.
News of the delay prompted Aton brokerage to cut its rating on UES to "hold" from "buy." But Khristenko said he does not share the market's pessimism.
"It is more important for those who will come to this business to clearly understand on what conditions and rules they will function," he said.
Fyodor Tregubenko, an analyst at Brunswick, said it was clear reforms had been stopped when it became clear last month that gas monopoly Gazprom had acquired a 10 percent stake in UES.
"It would have been naive to expect radical decisions from the government at this point," he said.
RAO "UES of Russia" Puts Hydrogenerating Unit 3 of Bureyskaya HPP into Commercial Operation
Moscow
23 November 2004
Today, hydrogenerating unit No. 3 of the Bureyskaya HPP has been put into commercial operation in the settlement of Talakan, Amurskaya Region. The inauguration ceremony was attended by the Deputy Chairman of the Russian Government Alexander Zhukov and the Chairman of the Management Board of RAO UES Anatoly Chubais.
The construction of the Bureyskaya HPP is provided by the Federal Target Program "Economic Development of the Far East and Transbaikalia for years 1996-2005 and until 2010" (dated March 19, 2003) and the Federal Target Program "Energy Efficient Economy".
This power plant is a top priority construction project of RAO "UES of Russia". In 2000 - 2003, the Holding Company invested RUB14.6 billion in own funds in the construction of the power plant. In 2004, RAO "UES of Russia" is to invest RUB8.9 billion in the construction of the Bureyskaya HPP. The amount of investments to be made in the construction project in 2005 is anticipated at RUB8.5 billion.
The first two hydrogenerating units of the Bureyskaya HPP were put into operation in June and November of 2003, respectively. Their aggregate capacity is 370 MW. The commissioning of the third hydrogenerating unit (300 MW) will increase the power plant's capacity almost twofold to 670 MW. This will improve the reliability of energy supply in the Far East and increase the share of cheap electricity generated by the hydropower plant in the region's energy balance.
The commissioning of the Bureyskaya HPP helped reduce the region's dependence on coal supplies. In 2004 alone, the generation at the power plant will save over RUB1.75 million tonnes of coal. After the power plant reaches its designed capacity, the savings will total 5.2 million tonnes of coal annually. In 2004, the annual savings as a result of reduction in the purchase of long-range coals will make RUB1.3 billion, and in 2007 the savings are expected to reach RUB4.7 billion.
The launch of the first two hydrogenerating units at the Bureyskaya HPP made it possible to reduce the electricity tariffs in the East energy area by 5-9% in 2003 and by 2.09% in 2004.
In the ten months of 2004, the power plant generated 1.6 billion kWh of electricity. Thus, the power plant made it possible to meet the increased energy demand in the area: the demand grew year-on-year by 857.8 million kWh in the ten months of 2004 to 30.7 billion kWh.
When the power plant construction is completed and all six hydrogenerators are put into operation, the capacity of the Bureyskaya HPP will reach 2,000 MW, and the average annual output will be 7.1 billion kWh.
State Registration of OAO "WGC-3" Completed
Moscow. 24 November 2004. OAO "Third Generation Company of the Wholesale Electricity Market: ("OAO "WGC-3") has been registered with the Interdistrict Inspectorate of the Ministry of Taxes and Levies of Russia for the Republic of Buryatia.
A decision to establish OAO "WGC-3" as a wholly owned subsidiary of OAO RAO "UES of Russia" was taken by the Board of Directors of RAO "UES of Russia" on 1 October 2004.
Pursuant to the resolution of OAO RAO "UES of Russia" on the establishment of OAO "WGC-3", Maxim Kuznetsov (previously CEO of OAO "Volgogradenergo") has been appointed Director General of OAO "WGC-3".
The following persons have been elected to the Board of Directors of OAO "WGC-3": member of the Board of Directors of RAO "UES of Russia" Vasily Zubakin; Deputy Managing Director, Executive Director of Business Unit 1 of OAO "RAO "UES of Russia" Daniil Nikitin; Chief of the Corporate Management Department of the Corporate Center of OAO RAO "UES of Russia" Andrey Gabov; Deputy Managing Director, Executive Director of Business Unit 1 of OAO RAO "UES of Russia" Ilyas Zagretdinov; Deputy Managing Director, Executive Director of Business Unit 1 of OAO RAO "UES of Russia" Vladimir Kimerin; Deputy Managing Director, Executive Director of Business Unit 1 of OAO RAO "UES of Russia" Alexander Negomedzyanov; Deputy Managing Director, Executive Director of Business Unit 1 of OAO RAO "UES of Russia" Ilya Gorev; Director General of OAO "WGC-3" Maxim Kuznetsov; Corporate Research Director of Hermitage Capital Management Ltd. Vadim Kleyner; Chief Analyst of Directorate for Energy Industry of OOO Evrazholding Sergey Arinin; Director of Investment Projects of ZAO Interros Holding Company Anton Klekovkin.
Pursuant to Order of the Government of the Russian Federation No. 1254-r of 1 September 2003, the following companies were included in OAO "WGC-3": OAO "Kostromskaya TPP", OAO "Pechorskaya TPP", OAO "Gusinoozerskaya TPP", OAO "Kharanorskaya TPP", OAO "Cherepetskaya TPP", and OAO "Yuzhnouralskaya TPP".
The charter capital of OAO "WGC-3" is RUB 16,629,846,629 and is divided into 16,629,846,629 ordinary shares of RUB1 par value.
80th Anniversary of Industrial Heating in Russia
Moscow. 24 November 2004. Tomorrow, 25 November 2004, is the 80th anniversary of the launch of industrial heating in Russia.
On 25 November 1924, the first public heating main was put into operation. The pipeline linked Leningrad Power Plant 3 (now called Power Plant-3 of the Central CHPP owned by OAO "Lenenergo") and one of the residential buildings on the Fontanka river embankment. In 1929, the length of Leningrad's heating mains reached 8.6 km. In Moscow, the first heating pipeline was laid in 1928.
Industrial heating made it possible to replace the costly and inefficient boiler houses with large sources of cheap heat, CHPPs. Thermal power plants no longer need to discharge the heat energy produced in the process of electricity generation, thus helping avoid the so-called "heat pollution" of the atmosphere.
In 2003, Russian Federation generated 1.4 billion Gcal of heat energy. The enterprises of RAO "UES of Russia" Holding Company generated 468.8 million Gcal of heat in 2003, or 32% of all heat supplied to Russian consumers during the year. In the ten months of 2004, the Holding Company's entities produced 390.6 million Gcal of heat.
RAO UES of Russia Opens a Special Account to Support Families of People Who Died or were Injured in Terrorist Acts
Moscow, 10 September 2004. RAO "UES of Russia" has opened a special account to which the Holding Company's subsidiaries and employees of energy companies may transfer money to support families of the people who were killed or injured in the acts of terror in August – September 2004.
RAO "UES of Russia" has donated RUB7.5 million in aid to the families of the 10 members of special army units killed and 27 soldiers wounded in the hostages siege in Beslan school.
"We receive numerous calls and letters from energy companies all over the country. People want to help those in grief," said member of the Management Board of RAO "UES of Russia" Andrey Trapeznikov. "The acts of terror did not pass by energy workers' families. There were people who died in the hostage release operation in the concert hall in Dubrovka, and people killed in the blast near the Avtozavodskaya metro station. The airplane blast on 24 August took away the life of the Federal Grid Company employee Stanislav Tarasov. 15 family members of employees of OAO "Sevkavkazenergo" died in the Beslan school siege.
The many thousand staff of RAO "UES of Russia" mourns with the families and relatives of those who died or were injured and express their sincere condolences.
Bank details:
Regional Public Fund for Social Security Assistance of Energy Workers
Lyublinskoye department No. 7977/01267 of Savings Bank, Moscow
Tax ID (INN): 7702241955, Bank ID (BIK): 044525225
account 40703810538250123700
Corr. acct. 30101810400000000225
RAO UES Enterprises Hold Over 5,300 Competitive Procurement Tenders Valued at RUB39.4bn in H1 2004
Moscow, 7 September 2004.
In the first half of 2004, the companies of RAO "UES of Russia" held over 5,300 competitive tenders to procure goods, works, and services valued at RUB39.4 billion. Procurement of goods and services on a competitive basis made it possible for the Holding Company's entities to save about 15%.
RAO "UES of Russia" started to form the system of competitive procurement of goods, works, and services in 1999. The system seeks to improve the manageability of cash flows, enhance transparency of spending, and reduce energy companies' variable expenses. The number of deals made by RAO "UES of Russia" and its SDCs using tendering procedures is growing every year. In the first 6 months of 2004, the number of competitive tenders exceeded the year-end results of 2003 by 1.5 times. The key avenues of development of competitive procurement are fuel supply to regional energos and AO-power plants, energy repairs, construction, and modernization of energy facilities.
One of the biggest tenders held in 2004 was the tender to select a company to modernize steam turbines for OAO Kostromskaya TPP. The contract was awarded to OAO Power Machines. In September 2004, RAO "UES of Russia" announced a tender for the supply of gas supply equipment for the Kaliningradskaya CHPP-2, which is now under construction. The purpose of this tenders is not only to purchase the most advanced and efficient equipment for the power plant and shorten the period needed to commission the project, but also cut the equipment procurement costs.
One of the principal areas of development of the competitive procurement system at RAO "UES of Russia" is expansion of e-business systems. Today, the major e-trading systems of RAO "UES of Russia" are TZS-Elektra.ru and B2B-energo.ru. In H1 2004, RAO "UES of Russia" entities made 1,466 deals valued at RUB 3.1 billion via the e-trading systems. The value of purchases made through the e-business systems is three times the figure for the whole of 2003.
Some companies of RAO UES Holding Company procure over 50% of all goods, works, and services through e-trading systems. These entities include the Verkhne-Volzhsky HPP Cascade, Nizhegorodskaya HPP, Ryazanskaya TPP, OAO Saratovenergo, OAO Stavropolenergo, and some other. Practice suggests that the use of e-business systems increases the objective and transparent character of the market while significantly reducing the time it takes to find the necessary goods and services. It also helps reduce the procurement costs, which creates conditions for limiting the growth of electricity and heat tariffs for end consumers.
Boguchansk GES agreed on the BOD chairman in 1.5 months after the AGM.
12 August 2004 15:41
Boguchansk GES BOD agreed on its chairman candidate Fri, Aug. 6, the company said. Sergei Diltaev (RAO UES) was elected to chair the Board of Directors.
S. Diltaev was appointed temporary chairman over the first sitting of the BOD held after the AGM on July 9 due to the disagreement between RAO UES (64.23% stocks) and EvroSibEnergo (over 26% stocks on behalf of Bazovy Element).
RAO UES has 5 from 7 seats on today's BOD of Boguchansk GES. EvroSibEnergo has 2 reps.
UES RESUMES ELECTRICITY EXPORTS TO BELARUS
MOSCOW, August 12 (RIA Novosti) - As of Thursday, Unified Energy Systems of Russia resumed exporting electricity to Belarus, a press release from the company said.
A contract was signed by UES subsidiary INTER RAO UES and the Belarussian State Energy Concern Belenergo.
According to the contract 2.5 billion KWh of electricity will be supplied to Belarus by January 1, 2005. "The supplies of Russian electricity to this republic in 2000-2003 averaged 3-5 billion kWh annually," the press release said.
Since the beginning of 2004, UES suspended electricity exports to Belarus, because the Federal Tariffs Service increased the network tariff for exported electricity.
INTER RAO UES is a subsidiary UES (60% stake) and Rosenergoatom (40%). The company performs the functions of an export-import operator for UES and of the Rosenergoatom.
RAO UES Delegation to Take Part in IGW-2004
Moscow, 9 August 2004. Today, the Working Group of RAO "UES of Russia" headed by the Chairman of the Management Board of RAO "UES of Russia" Anatoly Chubais will fly to Petropavlovsk-Kamchatsky to take part in the International Geothermal Workshop (IGW-2004) on 10-11 August 2004.
IGW-2004 is organized by the Geothermal Energy Society (GES) with the financial support of RAO "UES of Russia", OAO "Geotherm", the Global Environmental Facility, Savings Bank of Russia, Moscow Energy Institute, and OAO "Nauka". The Honorary Chairman of the Workshop is Anatoly Chubais, Chairman of the Management Board of RAO "UES of Russia".
170 specialists from 16 countries of the world will take part in the Workshop. They discuss the economic, technical, and scientific aspects of geothermal energy production. In particular, the Workshop will consider the promising technological solutions in the area of utilization of the Earth's heat, and projects to use the geothermal resources in Russia, the CIS, and Europe.
Geothermal energy is an environmentally safe source of power which can be used to generate heat and electricity. The Earth's geothermal resources are used in the energy industries of 58 countries of the world. In Russia's Kamchatskaya Region, there are 3 geothermal power plants with an aggregate capacity of 73 MW. Two of them – Mutnovskaya GeoPP and Verkhne-Mutnovskaya GeoPP – were built by RAO "UES of Russia" in 1999-2002. The global electricity production using geothermal resources is 50 TWh, with Russia accounting for 10% of this volume.
Reform of electric industry
RUSSIA'S ELECTRIC INDUSTRY TO BE REFORMED
MOSCOW, July 20 (RIA Novosti) - The Russian electric industry reform will begin in the third quarter of 2004, says the schedule on reforming the industry for 2004-2005 signed by Mikhail Fradkov.
According to the schedule, branch ministries, federal services and agencies including the Atomic Energy Federal Agency will submit to the government the regulation on establishing the procedures of providing intersystem electric connections and developing the procedures of the electric industry's on-line dispatcher control.
In the third quarter of 2004, the respective ministries and agencies will develop the rules of executing public agreements on the wholesale and retail energy markets, including exemplary agreements on energy supply to the consumers.
Besides, the schedule will suggest steps on taking the urgent measures to prevent and eliminate accidents at the fuel and energy system's facilities.
Developed also will be the procedures and criteria of determining the areas of the electric energy sale and purchase, where the competition is limited or absent.
The same terms will cover finding the sources of reimbursing the expenses inflicted by performing the operating organization's duties in the area of the atomic energy use. The government will be provided with the conditions and procedures of establishing a long-term technological power reserve and the issue of developing the procedures of the antimonopoly control on the electric energy wholesale and retail markets.
The concept of the federal law "On heat supply" will be worked out. According to the Russian government's plans, the finalized document will be submitted to the government in the first quarter of 2005.
In the first quarter of 2005, the respective ministries and agencies will develop and submit to the government the issue of establishing the conditions and procedures for maintaining the power reserves including the mechanism of reimbursing the expenses of the reserve facilities' owners and the procedure of rendering system reliability services and other system services. Determined in the same first quarter of 2005 will be the conditions and procedures of building and funding the energy industry's installations, while in the second quarter of 2005 the conditions and procedures of mothballing the energy industry's installations for repair.
The document points out that in 2004-2005 the state's representatives in RAO UES Russia board will get the directives on handing the energy joint stock companies' bus networks over to the interregional bus network companies.
The same period will witness drafting directives on handing the regional dispatcher control's property to the joint stock company System Operator - Unified Energy System's Central Dispatcher Control. Issued simultaneously will be a directive on restructuring the energy joint stock companies.
Energy Reform Plan Approved
GOVERNMENT APPROVES ENERGY REFORM PLAN FOR 2004-2006
MOSCOW, July 20 (RIA Novosti) - Russian Prime Minister Mikhail Fradkov has signed a decree on the plan for the reform of Russia's energy system for the period from 2004 to 2006. The premier's press spokesman Alexander Zharov said this to reporters on Tuesday.
"The plan for the reform was not drastically amended compared to its originally approved version," said Mr. Zharov. "Timeframes and ministries responsible for drafting a number of documents were only changed."
The Economic Development and Trade Ministry's press service said the draft plan for the reform of Russia's energy system was submitted to the government on May 21. The government staff introduced changes to the draft.
The reform's deadline was shifted to 2006 and the composition of the ministries involved was changed due to the government reform, according to the press service.
"The Industry and Energy Ministry retained principal responsibility for the reform. The Economic Development Ministry still has to amend the provisions of the law on insolvency dealing with energy enterprises' bankruptcy," said the ministry's press service.
"Several items dealing with the directive (procedure) of representing the state at the Board of Directors of the Unified Energy Systems (UES) Co were also changed," added the press service.
According to an Industry and Energy Ministry source, the notion of "the government's directive" was absent from the original plan.
"The directive was proposed to be removed from the plan as the issue will have to be discussed all the same," said a ministry source.
"To the best of my knowledge the government staff has preserved the directive," added the source.
The ministry source said 2006 was a more realistic deadline.
"The deadlines were shifted as we are behind schedule with the first phase of the reform. The new deadline is more realistic," said the source.
Mr. Fradkov said on July 1 when meeting UES chief Anatoly Chubais that the plan for the further energy reform would be considered at a government meeting in December next year.
"Terminating one of the key structural reforms is out of the question today," said Mr. Fradkov.
It is the executive authorities that are responsible for the reform and its outcomes, while the government must look into intermediate results and assess reform efficiency, according to Mr. Fradkov.
Mr. Fradkov also said it was important to decide what legislative acts should be adopted to achieve the major objective: to create a competitive energy market in Russia, which would be efficiently regulated by the state.
The premier also deemed it necessary to look into the reform's possible impacts on energy tariffs in provinces, on inter-budget relationships, and its relevance to the problem of cross-subsidies.
Transmission line accident causes outage in Georgia
Interfax. Friday, Jul. 9, 2004, 8:12 PM Moscow Time
TBILISI. July 9 (Interfax) - Tbilisi and other parts of Georgia were left without electricity after an accident on Friday on an arterial transmission line, the Georgian State Electric System told Interfax.
It was unclear at the moment of the company's report what had put the Imereti line out of operation.
The line links eastern Georgia to the Inguri hydro power plant in the west of the country, which had been generating nearly two-thirds of the nation's electricity before the accident.
Imereti is owned by Gruzrosenergo
Government to Privatize 2,000 Enterprises in 2005
http://www.mosnews.com/money/2004/07/06/privatization.shtml
RUSSIAN ENERGY MINISTER UPDATES MEDIA ON ELECTRICITY INDUSTRY REFORM
MOSCOW, July 9 (RIA Novosti) - Reform in the electricity industry is proceeding according to plan, although ways to form wholesale generating companies are to be identified, Energy and Industries Minister Viktor Khristenko said.
Speaking to the media Friday, the minister said that under effective laws, the ministry shall put together reports on electricity industry reform every six months and that the next such report was due in December this year
The fact that no final decision has yet been made as to how wholesale generating companies should be built will not disrupt the reform, Mr Khristenko assured. According to him, Russia's first generating company will have been set up before the end of this year. In all, ten companies are to be established. The Cabinet has instructed the ministry to examine the possibility of uniting all hydro-electric power stations into one wholesale generating company.
As he passed on to the issue of Russian oil exports, Mr Khristenko said that oil export schedules are drawn up for the quarter, the month, and the day ahead. There are no grounds to worry that the export may be disrupted, with crude and refined products now being supplied according to schedule, he assured.
Earlier, the embattled oil giant Yukos said it may suspend the export of oil owing to the Arbitration Court's ruling that it pay the nearly $7 billion back tax bill for the years 2000 and 2001.
The minister also said that this next fall the Cabinet would consider ways to raise the efficiency of the natural gas market.
High on the agenda of the Cabinet's sessions this autumn will be the gas market's performance and the possibility of enhancing its efficiency, Mr Khristenko said. According to him, the current state, potentialities and prospects of the gas sector will be under discussion.
On Saturday, July 10, the State Duma, or parliament's lower house, will be considering bills on affordable housing in their second reading, Mr Khristenko announced. He said that the MPs had revised the drafts in accordance with recommendations from the Cabinet. Tomorrow, they will vote on eighteen of the 27 bills on the package, primarily ones that "will have budget implications."
The minister said he was satisfied with the way the Cabinet and the Duma were working together. He expressed hope that the housing bills would have no problem getting through the house tomorrow, noting that the revision had made the drafts more precise and clear.
Visitors from among the general public come to Mr Khristenko's office to discuss issues ranging from utilities services to science, he said. Some of the visitors bring in designs of innovative building materials, proposals on how to save companies from bankruptcy, and developments on alternative sources of energy. Not only do the public make proposals on the use of unconventional and renewable energy sources (including the new efficient mechanism for using wind power), but they also present new perspectives on the nature of energy per se, the minister said. He assured that all the proposals submitted would be considered by experts from the ministry and, possibly, from the Academy of Sciences, as well.
RAO UES BOD to elect the chairman on July 30.
08 July 2004 13:09
RAO UES BOD will hold its first meeting on July 30, sources with the company's press service said.
At the meeting, the BOD will elect its chairman and the deputy chairman, consider Severo-Zapadnaya TETs financing, acquisition of a share in Nurenergo and territorial generation companies' establishment.
H1 2004 Savings from Competitive Procurement in Energy Repair Business of RAO UES Total RUB1.968 billion
Moscow. 7 July 2004. The savings as a result of competitive procurement of supplies, works and services for the energy repairs business of RAO UES enterprises in H1 2004 made RUB 1.968 billion. During the period, the regional energos and AO-power plants held over 4,600 reverse procurement auctions. The initial value of lots was RUB 10.430 billion, but the auctions made it possible to cut the prices at which goods were procured and reduce repair expenses.
Competitive procurement procedures are most effectively used by OAO "Kostromskaya TPP", OAO "Novocherkasskaya TPP", OAO "Nevinnomysskaya TPP", OAO "Orenburgenergo", OAO "Permenergo", OAO "Chelyabenergo", and OAO "Krasnoyarskenergo".
The program to procure supplies, works, and services for the energy repair businesses on a competitive basis has been implemented by RAO UES Holding entities over the past four years. Today, the use of competitive procurement is one of the key mechanisms ensuring cost control, accounting for 17% of the overall cost reduction in the Holding Company.
Under the annual competitive procurement program for the energy repair businesses of RAO "UES of Russia" for the year 2004, 8,697 tenders are to be held, with the initial value of the lots totalling RUB27.6 billion. It is anticipated that almost 60% of the funds allocated for the repairs will be used for procurement through the competitive tendering system. In 2003, under the annual program of RAO UES enterprises, RUB23 billion in funds was allocated for competitive procurement, which makes 53% of the total repair expenses, whereas the savings totalled RUB3 billion. In this connection, the Ministry of Economic Development and Trade of the Russian Federation said that the procurement system of RAO "UES of Russia" was the best among those of the country's state-controlled companies.
Bureiskaya GES ups FOREM deliveries to 701 mln kWh over the H1, 7% above the target.
06 July 2004 13:00
Bureiskaya GES widened its actual deliveries of electric power on FOREM to 701 mln kWh by H1 results, 7% above the target, Bureiskaya GES said.
The indicators have risen due to the additional loading target set by RAO UES.
Bureiskaya GES' construction started in 1985, 2 hydroelectric generators were launched in summer of 2003. 1.25 bln kWh have been produced to-date.
The 3rd generator will be put in operation in Nov. of 2004 while the final completion of the project is scheduled for 2009.
RAO UES power plants ups production by 2.1% on year to 331.7 bln kWh by H1 result.
05 July 2004 17:20
RAO UES power plants produced 331.7 bln kWh in the first half-yr, 2.1% up on year, RAO UES said.
Russia's energy consumption stood at 460 bln kWh, 2% up on year.
Hydroelectric power plants widened production by 16% on year to 65.1 bln kWh, heating power plants produced 266.6 bln kWh, in line with the H1 of 2003.
Smolenskenergo EGM seals outsourcing Smolensk GRES, completes the 1st stage of OGK-4.
05 July 2004 19:25
Smolenskenergo EGM approved June 30 the company's reorganization by splitting off six mono-profile companies - Smolensk Generation Co., Smolensk Backbone Grid Co., Smolensk Energy Management Co., Smolenskenergosbyt sales company, Smolensk Energy Repair Co. and Smolensk GRES, sources with Smolenskenergo told AK&M.
Smolensk GRES is the last power plant split off from AO-Energo which is not 100% sub. of UES. It will be entered into the OGK-4 along with Shaturskaya GRES, Yaivinskaya GRES, Surgutskaya GRES-2, Berezovskaya GRES-1 (the last two powere plants are 100% owned by RAO UES).
Sovietology Strikes Back
http://www.themoscowtimes.com/stories/2004/07/05/006.html
Bank Failure Endangering Nuclear Plants — Companies
Created: 02.07.2004 14:38 MSK (GMT +3), Updated: 16:08 MSK
http://www.mosnews.com/news/2004/07/02/dialog.shtml
MosNews
The heads of several Russian energy companies have said that backlogged payments from the under-fire Dialog-Optim bank may lead to “emergency situations” at some of the nation’s nuclear plants which the energy companies supply.
The energy companies have called on the Central Bank to take “immediate measures” to regulate the conflict, a Dialog-Optim spokesman told MosNews.
He said, however, that the transactions involving the companies were between their own banks, and could not have affected atomic energy plants.
The four companies — Khimenergo, Energokaskad, Energogigant, and Spetsenergoprodukt-95 — are all clients of the Dialog-Optim bank and say the bank has frozen their accounts and is not making transfers.
The companies have not informed Dialog-Optim directly, however, the spokesman told MosNews.
As a result of the delays, repair work at several nuclear electric plants is under threat of cancellation, Ekho Moskvy radio quoted the letter as saying. The postponement of repairs at the Kalininskaya Nuclear Electric Plant, which is located only 300 kilometers from Moscow and is as powerful as the late Chernobyl plant, may lead to disaster, the letter says.
The companies say they renounce all responsibility for the nuclear stations if the Central Bank fails to take appropriate measures.
The bank’s troubles began when clients issued complaints earlier this month that Dialog-Optim bank is limiting payouts on deposits and processing all client payments with delays. The problems sparked further fears of a liquidity crisis among banks that started when Sodbiznesbank was stripped of its banking license.
Dialog-Optim, meanwhile, denies its role. “We cannot influence atomic energy in Russia,” the bank’s spokesman told MosNews. “[Nikolai Shinkarev of the Federal Atomic Energy Agency] said it is unacceptable to mention atomic energy in the context of the liquidity crisis.”
The Central Bank, quoted by Ekho Moskvy radio, has also said that nuclear plants are under no risk as of yet.
M. Fradkov confirmed to A. Chubais that reorganization decisions on energy systems and interregional integration not to be reconsidered.
01 July 2004 19:39
Russia's Prime Minister Mikhail Fradkov has confirmed to RAO UES CEO A. Chubais today that no reorganization decisions on energy systems and interregional integration of the companies outsourced from AO-energos will be reconsidered. They are to be implemented in part and in whole, RAO UES said.
Anatoliy Chubays is satisfied by the sums of the current today
conversation with prime minister Mikhail Fradkov Moscow.
translated - unedited
1 July 2004
The chairman of administration RAO THE "EES OF RUSSIA" Anatoliy
Chubays stated, that it is satisfied by the sums of the conversation current today
with prime minister Mikhail Fradkov. "during almost 2- X of hours we thoroughly discussed practically all
aspects of the reform of electro-energetics. Today I obtained the confirmation of principally important position of
government - the need for reform for doubt does not undergo, a question about its cancellation does not stand ". According to Anatoliy Chubays, in the course of today's encounter it was also confirmed, that the previously solutions about the reorganization of power
systems accepted, on the interregional integration of the newly created companies, they are not subject to revision and they must be realized entirely. As emphasized Anatoliy Chubays, the management of energy-holding is ready entirely to be set in
operation on the estimation of that, which is made in the course of reform, to the introduction of reasonable corrective and the realization of
these solutions.
RAO UES interested in cooperation with Iran.
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 7:36 PM Moscow Time
RAO UES is highly interested in collaboration with Iranian energy companies, RAO UES head Anatoly Chubais declared at a briefing in Zelenograd (the Moscow region). According to him, there are some promising directions of cooperation concerning Azerbaijan and Armenia. Chubais also mentioned that a tripartite meeting of representatives of the Russian, Iranian and Tajikistani electrical energy sectors would be held in the near future. Participants will discuss a number of joint investment projects.
Deripaska Loses UES Board Bid
http://www.themoscowtimes.com/stories/2004/07/01/041.html
RUSSIAN GOVERNMENT INCREASES ITS STAKE IN UES ELECTRICITY GIANT
MOSCOW, June 30 (RIA Novosti) - The Russian government's stake in the electricity giant Unified Energy Systems (UES) has increased to 52.68 percent, up from 52.5%, Board Chair AlexanderVoloshin said at an annual shareholder meeting Wednesday. The increase has resulted from the liquidation of the National Investment Corporation and the transfer of its assets to the Property Ministry, he said.
The number of the UES shareholders topped 350,000 by the end of the year under review, Voloshin reported. Its assets include stakes in 242 companies, the property of six electricity plants, electricity supply networks, and control facilities.
Unified Electricity Systems Inc. holds shares in 73 regional electricity corporations, 44 electric power plants, and six managing energy companies, the UES Chair said.
Speaking at the annual shareholder meeting, Chief Financial Officer Dmitri Zhurba told about the Tax Ministry's decision to write off some 1.4 billion roubles owed to it by UES in fines (the dollar buys 29 roubles, on current rates). This decision was made in view of the fact that in 2003, UES had fulfilled all of its obligations as to the settlement of the rescheduled debt to the federal Treasury. Moscow City Hall is going to follow suit and write off 2.2 billion roubles that the company owes it in debt payments, Zhurba said. According to him, UES' rescheduled debt to the Treasury now totals 6.6 billion roubles,
UES Chief Executive Officer Anatoly Chubais does not expect any major reshuffles in the Board of Directors, customarily elected at annual shareholder meetings. "We are not anticipating a revolution on this matter, and I don't think any strategic transformations will occur in the Board's membership," Chubais said. In his prediction, only some of the minority shareholders may be removed while all major ones will most likely retain their present positions.
RAO UES shareholders approve balance sheet for 2003
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 5:55 PM Moscow Time
RAO UES shareholders have approved the balance sheet, and the income statement for 2003 at their general annual meeting, which took place in Zelenogragd today. The company's RAS net income declined 20.6 percent to RUR24.6bn (about $848m) in 2003. Core revenue slid 1.7 percent to RUR51.6bn (about $1.779bn). RAO UES sales decreased 4.6 percent to RUR30.8bn (about $1bn). 83.5 percent of RAO UES shareholders took part in the annual meeting.
RAO UES to pay dividends for 2003
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 6:29 PM Moscow Time
RAO UES shareholders have approved RUR0.0469 per common share and RUR0.2283 per preferred share in dividends for 2003 at their annual general meeting, which took place in Zelenograd today. Thus, the company will allocate RUR1.924bn (about $66m) for dividend payments for 2003 including RUR473.7m for payments on preferred shares. This is a 20.64-percent increase in dividend payments compared to 2002. In 2002 the company allocated RUR2bn (about $68m) for dividends, which is a 50-percent yearly increase.
Economy Minister on wholesale energy generating companies
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 2:20 PM Moscow Time
A new date for the decision on wholesale energy generating companies does not mean a delay in implementing the energy reforms, Russian Economy Minister German Gref announced at an investment forum in the city of Yaroslavl. There is no decision to halt the reforms, he stressed. As for the deferred decision on the method of selling wholesale energy generating companies, Gref said that wholesale energy generating companies had not been formed as yet. One should form them before making any decision on selling them, he emphasized. Gref considers this will be possible no sooner than at the end of 2004 or in 2005.
RAO UES head comments on energy reforms
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 12:58 PM Moscow Time
"We should not abandon the core targets of the energy reforms," RAO UES head Anatoly Chibais announced at a briefing before the annual general shareholder meeting. According to Chibais, RAO UES management is going to cooperate with the Russian government to go on with the reforms. He stressed that it was possible to change the methods of implementing energy reforms and their terms, but it was impossible to abandon their main targets. The energy reforms are covered by the number of laws. RAO UES head believes that the core target of the energy reforms is to enhance the state's control in the monopolized sector of electrical energy market(the Federal Network Company and the System Operator) and to hand a number of energy generating assets to private enterprises. Chibais stressed he did not foresee any revolutionary changes in the board of directors of the company. He hopes the state will retain its 10 positions on the 15-member board of directors.
RAO UES shareholders to hold meeting today
RosBusinessConsulting. Wednesday, Jun. 30, 2004, 9:17 AM Moscow Time
The annual general meeting of shareholders of RAO UES will take place today. According to the agenda, shareholders are to approve the annual report of RAO UES for 2003 and the annual accounting statement, to discuss dividend payments, to elect the Board of Directors and the Audit Commission as well as to approve an auditor for the company.
Mosenergo`s shareholders approve reorganization plan
29 June 2004 18:44
Shareholders of Mosenergo approved a project on reorganizing the company at an annual general meeting, which took place on June 28, 2004, a source close to the company’s Board of Directors told RBC. In fact, reforms at Mosenergo can become the first positive experience of reforming an energy company in Russia, which affects foreign investors as well. Some 99.77 percent of the shareholders, who took part in the meeting, supported the compromise achieved by the company’s management headed by Arkady Yevstafyev. In total, 82.43 percent of the shareholders, who had the right to participate in annual shareholders’ meetings, took part in this meeting.
According to the project, Mosenergo will be reorganized by means of establishing several companies without changing the authorized capital of Mosenergo. Most energy generating assets (17 electrical power stations), excluding those that are to be transferred to wholesale energy generating companies, will remain in the structure of the assets of Moscow City Generation Company, which will still use the Mosenergo brand. On the basis of Mosenergo, some four energy generating companies, Moscow city and Moscow region electrical distribution companies, a heating company, a sales company, a managing company, the main network company as well as companies that will be dealing with construction, design, repair and other services are planned to be created in the course of the reorganization of Mosenergo. At the same time, shareholders who did not take part in the annual meeting or voted against this project may offer their shares for purchase to the management of the company.
According to a preliminary schedule of the company’s reorganization, it is expected that a shareholder meeting of each newly established company will take place in November 2004 and the state registration of the new public companies will be completed by the beginning of 2005. According to agreements concluded between RAO UES and the governments of Moscow and the Moscow region, an exchange of shares of Moscow City Heating Network Company and Moscow City Electricity network Company for shares that the Moscow government has in other companies is expected to happen in the fall 2005.
In addition, dividends for 2003 totaling RUR0.02169 (about $0.0007) per common share were approved at the annual general shareholders’ meeting. As a result, the volume of dividend payments for 2003 will increase by 18 percent. The total volume of dividend payments will reach some RUR613.126m (about $21.13m). The net income of Mosenergo under Russian Accounting Standards increased by almost 2.7 times in 2003 and reached RUR1.73bn ($59.61m).
The shareholders’ meeting also elected a new Board of Directors of the company consisting of 13 people. Yury Udaltsov, a member of the Executive Board of RAO UES was elected as the Chairman of the Board of Directors of Mosenergo.
The authorized capital of Mosenergo amounts to some RUR28.267bn (about $984.39m). It is divided into the same number of shares with a par value of RUR1 (about $0.034). RAO UES owns 50.85 percent of the shares, the department of state and municipal property of Moscow together with Bank of Moscow controls about 8 percent and Gazprombank has 15.76 percent. In addition, about 9.5 percent of the shares were deposited as ADRs.
[RBCTop]
Ministry proposes to merge hydro gencos
Interfax. Tuesday, Jun. 29, 2004, 6:10 PM Moscow Time
MOSCOW. June 29 (Interfax) - The Russian Economic Development and Trade Ministry has already sent a proposal to the Industry and Energy Ministry to merge four wholesale generating companies (gencos), to be set up based on hydroelectric plants, into a single company, First Deputy Economic Development and Trade Minister Andrei Sharonov told Interfax.
He said that to merge the hydro gencos the Economic Development and Trade Ministry plans to make amendments to a government resolution that confirms the setting up of 10 gencos. "Now, instead of hydro gencos No. 7, No. 8, No, 9 and No. 10 there should be one," the deputy minister said.
Sharonov said that the Economic Development and Trade Ministry does not plan to prepare a separate directive for state representatives on the board of directors of Unified Energy System of Russia about the unification of the hydro gencos. "It may be signed only to reach a decision on the setting up of this concrete company," he said.
Deputy Prime Minister Alexander Zhukov on June 2 directed the Industry and Energy Ministry and the Economic Development and Trade Ministry to submit a draft decision on this issue within two weeks. However, it has not yet been submitted.
A government resolution confirming the configuration of the future gencos was passed in 2003. According to this document, it was planned to include Volga-Kama Cascade Hydroelectric Plant and Caucasian hydroelectric plants into the sixth and seventh gencos, Siberian and Far East hydro plants into the eight; the ninth was to be set up based on one plant - Zagorsk Hydro-Accumulator Station, which is currently part of OAO Mosenergo.
The concept for the reform of the electricity sector states that the government will not reduce its stake in hydro generation or, as a result, in the hydro gencos being set up
Electricity supply reduced to water intake facility in the city of Yelizovo of Kamchatka
29.06.2004, 08.08
PETROPAVLOVSK-KAMCHATSKY, June 29 (Itar-Tass) - The Kamchatskenergo electricity company has restricted electricity supply to the water intake facility of the city of Yelizovo, the second biggest city on the Kamchatka Peninsula, company sources told Itar-Tass on Tuesday.
No restrictions have been introduced as of yet to facilities ensuring water supply for the population of the city, but measures can be tightened as debts of the water intake facility have exceeded 51 million roubles.
The electricity company has offered the administration a scheme of debt payment, but no money has been paid so far. It will be impossible to solve the problem without the help of the local budget. However, at the present moment the regional administration has no money to help the debtor financially. That means electricity restrictions will continue, the sources stressed.
Chubais sees OGK issue resolved after December 2 govt meeting
http://www.prime-tass.com/news/show.asp?topicid=61&id=353090
MOSCOW, June 28 (Prime-Tass) -- The issue of establishing wholesale generating companies (OGKs) in Russia may be tackled after the government’s December 2 meeting, the Chief Executive of Russia’s power grid monopoly UES Anatoly Chubais told reporters Monday.
He was commenting on Prime Minister Mikhail Fradkov statement last week that a decision on the establishment and sale of OGKs would be delayed until the year-end. Chubais said that “this is not good news for those who are pushing for power sector reform.”
The news caused Russian stocks to lose U.S. $500 million in ten minutes, he added.
But Chubais admitted that reform of the Russian power sector would only be possible with the firm backing of the government.
“If the government says it needs six months to decide on OGKs, then we will do our utmost to help it come to a decision,” Chubais said.
UES had planned that the issues concerning the establishment and sale of OGKs would be finalized on June 25 at a meeting of the board of directors of UES.
But the governmental directive on OGKs for government representatives on the company’s board was not approved before the meeting took place. Fradkov said last week that the government was still undecided as to how the OGKs were to be created, reiterating that the issue should be thought through carefully.
According to the power sector restructuring plan, of the ten OGKs that are to be set up on the basis of the country’s largest power plants, the government will retain control of the four that will incorporate hydroelectric power stations, while stakes in the remaining six OGKs, created on the basis of thermal power plants, will be sold.
UES’ strategy and restructuring committee recommends that the charter capital of OGK-1, OGK-2, OGK-4 and OGK-6 be set up with cash, while OGK-3 and OGK-5, with cash, shares of UES’ subsidiaries, and UES’ property.
It was preliminary decided that OGK-5 is to be sold first. (29.0256 rubles – U.S.$ 1) End
28.06.2004 19:34
Individuals share dn from 13.2% to 8.05% in Chelyabenergo stock capital.
28 June 2004 19:09
The share of individuals in stock capital of Chelyabenergo slid from 13.2% to 8.05% in 2003, AK&M learnt from the documents made out for June 25 AGM.
As of Jan. 1, 2003, individuals (Russia's residents) held 13.2% Chelyabenergo. However their stake went dn to 8.05% on Jan. 1, 2004.
Simultaneously, the share of entities and nominal holders widened to 27.23% (on Jan. 1, 2004) vs. 22.1% on Jan. 1, 2003. Legal persons - non-residents held 0.6%, residents - 0.7%, nominal holders - 20.8%).
RAO UES stake stands still at 49%, Russia's Property Ministry has 15.72%.
Chelyabenergo has 5,506,606,270 rbl in stock capital split into 4,647,386,854 common stocks, 1 rbl par each, and 859,213,916 preferred stocks (A-class), 1 rbl par each.
The company's register set forth 8,219 holders as of Jan. 1, 2004 (less nominal holders).
--------------------------------------------------
Chelyabenergo capitalization up 2.8 fold to $162.9 mln.
Chelyabenergo capitalization widened 2.8 fold over the year, to $162.9 mln from $57.4 mln, Chelyabenergo GD V. Seredkin said over the June 25 AGM.
RAO "UES of Russia" and Enel-ESN Energo signed a General Agreement and a Management Contract to operate the North-West TPP
Moscow, June 28, 2004
RAO "Unified Energy System of Russia" ("RAO UESR") and Enel-ESN Energo signed today a General Agreement and a Management Contract to operate the North-West Thermal Power Plant ("NWTPP") near St. Petersburg. The documentation was signed by Anatoly Chubais, CEO of RAO UESR, Paolo Scaroni, CEO of Enel, and Grigory Berezkin, CEO of ESN.
The NWTPP management contract places management control of a key Russian power asset in the hands of a consortium led by a major international electricity company for the first time.
The Italian-Russian consortium of Enel (Italy) and ESN (Russia) won the tender to manage the NWTPP in February 2004. Enel-ESN Energo participated in the tender along with 9 other major international power utilities satisfying strict prequalification criteria: installed generating capacity (owned or under management) over 5,000 MW, revenue in 2002 over $5bn, experience in managing international assets, credit rating – investment grade or above. These companies were given an opportunity to conduct a detailed due diligence of the NWTPP, including site visits. Two of them, Enel-ESN Energo and Fortum, submitted final binding bids. JPMorgan has been advising RAO UESR on the financial aspects of this transaction and law firm Akin, Gump, Strauss, Hauer & Feld, LLP has been acting as legal advisor to RAO UESR.
According to the key terms of the Management Contract approved by the Board of Directors of RAO UESR, the Management Company will act as the sole executive body of the plant for the next three years, and will also organize about US$125mm of financing to complete the construction of the second generating unit.
RAO UESR are confident that the involvement of Enel-ESN Energo will bring a significant improvement in technological and organisational efficiency of the NWTPP, given Enel’s management and technological expertise in managing CCGT plants of similar design, combined with ESN’s successful experience of managing Russian power assets. Enel-ESN Energo obtains, in turn, a unique opportunity to enter the Russian power market, a market with strong growth potential, in order to gain practical experience and to determine future investment opportunities.
***
The North-West Thermal Power Plant is located near St. Petersburg in the North-West region of Russia and is the most technologically advanced in Russia, utilising a modern Combined Cycle Gas Turbine technology. The plant’s efficiency ratio amounts to 51.5%, compared to less than 40% for common steam units. The first generating unit of the power plant has an installed capacity of 450 MW. Commissioning of the second generating unit will enable a capacity upgrade up to 900 MW. RAO UESR possesses a 61.8% stake in the NWTPP.
RAO UESR is the world’s largest power holding, providing for reliable operation and development of the Unified Power System of Russia. RAO UESR controls more than 70% of Russia’s power capacity and output and about one third of country’s heat output. In 2003 the holding’s revenues amounted to RUB 724.9bn, RAS. Current market capitalisation exceeds US$12bn.
Enel is Italy’s major electricity company with over 40,000 MW of installed capacity and a market capitalization of approximately ˆ40 billion. It is involved in the generation, transmission and distribution of electricity, and is also the country’s second biggest gas distributor. It is also the European leader in the use of CCGT technology with over 5,000 MW of installed CCGT capacity, and a world leader in renewable energy production with approximately 17,000 MW of installed renewable capacity in Italy, Spain and the Americas. Its 2003 revenues amounted to ˆ31.3 billion, EBITDA was ˆ9.8 billion and net income was ˆ1.1 billion.
ESN is a group of companies led by Grigory Berezkin, specializing in strategic and crisis management. Until 1999 ESN was managing oil company "Komi TEK" and until 2003 – the regional energy system "Kolenergo". The group is currently one of the largest shareholders of RAO UESR, holding a 5.3% stake in it.
The decision to outsource OGK may be taken at Dec. 2 sitting of the Government, A. Chubais says.
28 June 2004 16:58
[AKM]
RAO UES, Enel ESN Energo Consortium sealed the contract for 3-yr management of Seveno-Zapadnaya TETs.
28 June 2004 17:41
RAO UES and Italian/Russian Enel ESN Energo sealed June 28 the general agreeemnt and the contract to manage Severo-Zapadnaya TETs. RAO UES CEO A. Chubais, Enel Managing Director P. Scaroni, ECH Group's Board Chairman G. Berezkin, TETs BOD Chairman S. Dubinin signed the documents.
4 documents were signed overall, incl. three party agreement between RAO UES, ENEL SPA, ECH; the contract between Severo-Zapadnaya TETs and the management company (signed by G. Berezkin and A. Chubais) and two backing agreements (signed between S. Dubinin and G. Berezkin and between S. Dubinin and P. Scaroni).
SUEK may widen its stake in RAO UES from today`s 6%.
28 June 2004 12:44
Siberian Coal & Energy Co. (or SUEK) may widen its stake in RAO UES vs. today's 6%, SUEK GD V. Rashevsky told Vedomosti.
SUEK is mostly regarding RAO UES stocks as portfolio investments today, V. Rashevsky said.
When reorganized, SUEK sees itself as a strategic investor with the energy as profile business for many years running. The company will concentrate on generation and first of all on the territorial generation companies established based on those AO-energo where SUEK holds large stakes, V. Rashevsky said.
Fradkov Unplugs Power Reforms
Monday, June 28, 2004
http://www.themoscowtimes.com/stories/2004/06/28/001.html
By Lyuba Pronina
Staff Writer Prime Minister Mikhail Fradkov pulled the emergency break on energy reform Friday, halting any and all sales of generating assets until his government can determine how privatizing huge swaths of the electricity sector will benefit society.
The government had been expected to approve a plan drafted by Unified Energy Systems to group dozens of power plants scattered across the country into 10 wholesale generating companies, six of which would then be auctioned off for cash or UES shares.
But Fradkov announced Friday that the government is temporarily freezing reforms because it is concerned not only about the plans to privatize wholesale generating companies, known as OGKs, but also about how restructuring of the sector as a whole has been handled since 2001.
"At a government meeting at the end of the year [we will] thoroughly analyze the efficiency of the work that has been done since 2001 and determine what further steps need to be [taken]," Fradkov told reporters after a meeting with senior government officials, Interfax reported.
"The issue of separating OGKs is an element of energy reform and the government should start to make a decision on this issue after a comprehensive assessment of this reform's progress," he said.
The OGK issue is at the center of a years-long government drive to introduce elements of competition -- and thus private capital -- into the electricity sector by overhauling and then breaking up state-controlled UES and selling off some of its assets.
Many wealthy industrialists have spent the last year building up small stakes in UES on the expectation that they would be able to swap them for bigger stakes in specific generating assets that would fit well with their existing business interests, such as aluminum production. Foreign investors have also been along for the ride, which has seen UES's share price rise from 15 cents since early 2002.
Now, however, all those plans are in doubt. In the minutes after Fradkov's announcement, the price of UES shares dropped some 4 percent on MICEX, and some analysts now expect the market value of the world's largest electricity company by installed capacity, currently just over $11 billion, to be cut in half in the coming weeks.
"Chubais had staked everything on the OGK plan. Now the whole reform has practically ground to a halt," said Andrei Zubkov of Trust investment bank. "It makes no sense to talk about liberalization now that there won't be any competition."
Zubkov said it was hard to see why investors would want to hold on to their UES shares now that it looks unlikely that those shares will be able to buy generating assets any time soon. "You don't have to go to a fortune teller for that," he said.
For five straight months, the UES board, citing "technical delays," failed to make a final decision on the makeup and auction conditions of the OGKs.
This time, however, the delay does not "look technical," Zubkov said. Rather, it looks like a "political delay" by "some people in very powerful circles who do not want OGKs to be privatized," he said, adding that the recent developments surrounding Yukos may have played a role.
"It may well be that [President Vladimir Putin] does not want to see the same mistakes that were made in privatizing the oil industry repeated in the electricity industry," Zubkov said.
Chubais, the UES chief, oversaw the bulk of early privatizations and has been called the father of the oligarchs for his efforts. Interestingly, Fradkov said that one reason for the indefinite delay in UES reform was that the OGK issue was "attracting special public attention."
"The concern of investors is clear, and the resolution of this issue is important for investors to further identify their economic strategy," Fradkov said.
Earlier this month, metals magnate Oleg Deripaska, owner of Russian Aluminum, the largest corporate electricity consumer in the country, called on the government to delay creating and selling the OGKs because he said it would cause chaos in the industry.
"We are pleased the government agrees with our position," said David Geovanis, who represents Deripaska's holding company, Basic Element, on the UES board.
"We are all in favor of reform and a free market for electricity, but the kind of chaotic, shooting-fire process that is going on now is irrational," Geovanis said by telephone. "[Fradkov's decision] is good news for shareholders and good news for the country," he said.
Other minority UES shareholders, however, said just the opposite.
"This is alarming ... very disappointing," said former UES board member Alexander Branis, director of Prosperity Capital Management.
"From the shareholders' point of view, the proposals on reform are not ideal and could be further developed. But it should not take six months," Branis said.
Chubais himself played down the developments, although he said he and other UES executives were becoming increasingly frustrated.
"He did not say a single word about stopping energy reform," Chubais said in a conference call with investors, referring to Fradkov. "No doubt, the fact of delaying major decisions on the reorganization of the company cannot but frustrate management and everyone else who is concerned."
"For us, the task of reforming the electricity industry can only be accomplished with the clear, complete and unambiguous support of the government," Chubais said. He added, however, that there are two key pillars to the reform blueprint -- strengthening government control over the national grid and other infrastructure, while simultaneously creating and privatizing large generating companies that will compete with each other.
"Rejecting either of these ideas would devastate the entire [reform] concept," Chubais said. Some analysts, including Sergei Suverov of Zenit Bank, said it was unlikely the reform effort would be derailed for good.
"It may be that the government just decided to review the structure of a few OGKs, such as those with large gas-powered stations so that Gazprom could play a larger role in the industry," Suverov said.
"It would not be beneficial to the state to curb the reform, otherwise it will have to finance the upgrade of facilities [itself]," he said.
RUSSIA REFORMS POWER INDUSTRY: CABINET TO DECIDE ON MAMMOTHS BY YEAR'S END
MOSCOW, June 25 (RIA Novosti) - The federal government held conference today on power industrial progress and reforms. Prime Minister Mikhail Fradkov addressed the gathering.
The Cabinet has scheduled reform analyses for the year's end. It will blueprint further steps for closer compliance with related laws, and decide on practical patterns to cluster in the big power generating companies, he said.
Effective bylaws are to underlie the reform. The package needs final brushstrokes-an essential task. The government will weigh all the reform pros and cons, take stock of prospective hazards, and estimate the tentative social, economic and financial reform impact. All that will promote sound decisions on corporate mammoths and other aspects of the reform.
In another address, following the conference, the Premier highlighted close public attention to mammoths' future. Available decisions are conceptual and concern many Russian regions, where thermal power stations are situated, to say nothing of United Russian Power Grid Co. stockholders, and all electricity consumers-in fact, the entire nation.
Capital investors have every ground for concern-upcoming reform moves will largely determine their economic strategies.
It is up to the Cabinet now to face the public with explicit replies to a huge range of questions on the power industrial reform, said Mr. Fradkov.
Followers
|
1
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
45
|
Created
|
06/25/04
|
Type
|
Free
|
Moderators |
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |