RusEnergy

IZHEVSK, June 21 (RIA Novosti) - President Vladimir Putin said Wednesday that state-controlled Rosneft oil company would manage regional producer Udmurtneft [RTS: UDMN], recently sold to leading Chinese oil producer Sinopec. "This deal will certainly strengthen Rosneft and raise its capitalization," Putin said during a visit to Izhevsk, the capital of Udmurt Republic in the Volga region, adding that Rosneft would launch an initial public offering of its shares in the near future. State-run Rosneft will acquire 51% of Udmurtneft from China's Sinopec, which won a tender Tuesday to buy the asset from TNK-BP [RTS: TNBP], respected Russian business daily Vedomosti said. On Tuesday, TNK-BP said it had agreed to sell 96.7% in the oil producer, which is based in the Volga-region republic of Udmurtia and provides 8% of TNK-BP's oil output, to China Petroleum & Chemical Corporation, part of the Sinopec Group. Sinopec will then finance the Rosneft deal for Udmurtneft, which the Russian oil company will repay from the new asset's earnings. In May, Rosneft concluded an option deal with Sinopec to buy 51% in Udmurtneft if Sinopec won the tender, Rosneft said in a news release quoted by the paper. A high-ranking Kremlin source said Wednesday that Russia and China had agreed that Udmurtneft's main unit would remain in the Udmurt Republic and that it would pay taxes to the local budget. "In general, I think, it would be good for the republic," Putin said. "It would help the republic to develop its energy sector."