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Rosneft Buys Remaining 49% Stake In Itera For $2.9 Bln

Russia's state-owned oil company OAO Rosneft (ROSN.L) said Tuesday that it has acquired the remaining 49 percent stake in Itera Oil and Gas Co. LLC from Itera Holdings Ltd. for $2.9 billion, giving it full ownership of the Russian independent gas producer.

Rosneft noted that consolidation of Itera was consistent with its strategy aimed at increasing gas production to 100 billion cubic meters or bcm per annum and transform Rosneft into the largest independent gas producer in the Russian Federation. According to the company, the deal will enable it to accelerate development of the Kynsko-Chaselsk group of fields.

Commenting on the deal, Igor Sechin, President of Rosneft said, "Gas business is one of the top priorities for the Company. Consolidation of Itera Oil and Gas Co LLC will have a significant multiplier effect on our future growth and generate additional synergies, which will ultimately increase the total capitalization of the company and bring additional value to shareholders."

In August 2012, Rosneft completed a deal with Itera to create a joint venture to produce and sell gas. Rosneft obtained a 51 percent stake in the joint venture in exchange for a 100 percent stake in the charter capital of Kynsko-Chaselskoye Neftegaz, which owns the license for the Kynsko-Chaselsk license block, and $173.4 million in cash.

The joint venture's consolidated proved and probable reserves under international classification amount to 427.2 bcm of gas and 25.8 million tonnes of liquid hydrocarbons. The joint venture's projected gas output in 2013 is about 13 bcm.

In March 2013, Rosneft completed the takeover of TNK-BP, the third largest oil company in Russia. was a 50:50 joint venture formed in 2003 by merging the Russian oil and gas assets of British energy giant BP plc (BP, BP.L) and the oil and gas assets of Alfa-Access-Renova or AAR, a consortium consisting of a group of four Russian billionaire oligarchs.

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