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Russian state oil firm Rosneft on Friday put its man in charge of Yuganskneftegaz, taking control of the main production unit of oil major Yukos, which is challenging the government auction of the asset in US courts. Rosneft managers, escorted by bailiffs, arrived at Yuganskneftegaz's Siberian headquarters and told staff there that Rosneft had already fully paid the state $9.4 billion for the unit, Yukos spokesman Alexander Shadrin said.

"Rosneft claim they have fully paid for Yugansk via MDM bank, have shown us some documents and want to hold an extraordinary general meeting today after registering title of ownership," Shadrin told Reuters. Rosneft later said the meeting appointed the head of Rosneft's Purneftegaz unit, Vladimir Bulba, as the new general director.

Rosneft, MDM and the Russian Federal Property Fund, which auctioned Yugansk on December 19, did not answer repeated calls.

One member of Yugansk's staff reached by phone from Moscow said: "I can't say anything." She gave other phone numbers which were either engaged or went unanswered.

The ultimate source of funding for the purchase of Yugansk remains a mystery, but it is clear that Rosneft - with debts of $4.4 billion at mid-year - would have needed outside financing.

Rosneft has already raised $1.7 billion by selling joint venture assets to Russian gas monopoly Gazprom, which was originally tipped to win the Yugansk auction.

Sources familiar with the Yugansk deal said state-owned Sberbank was a key source of funding. Sberbank also could not be reached for comment.

The Yugansk auction marked the climax of a Kremlin campaign to crush Yukos's politically ambitious principal owner, Mikhail Khodorkovsky, and seize control of strategic sectors of the economy sold off in the chaotic privatisation's of the 1990s.

Yugansk, which pumps 1 million barrels per day of crude, or 60 percent of Yukos's output, was sold to help recover more than $27 billion in back taxes owed by Yukos.

Yukos filed for bankruptcy in the United States to try and halt the Yugansk sale, and has vowed to press damage claims of $20 billion against anyone involved in the deal.

Gazprom pulled out of the Yugansk auction at the last minute after Western banks syndicating a 10 billion euro ($13.6 billion) loan, led by Deutsche and ABN Amro, got cold feet due to legal risks.

Gazprom Chairman Dmitry Medvedev, who is also President Vladimir Putin's chief of staff, said on Thursday a planned merger between Gazprom and Rosneft would go ahead as scheduled in January - but without Yugansk's assets.

Russian officials have made conflicting statements in recent days over who will end up as the ultimate owner of Yugansk, suggesting the Kremlin has had to rework its take-over strategy to protect against litigation.

Copyright Reuters, 2005


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