RusEnergy

23 July 2007 - Upstream OnLine - A Moscow arbitration court today upheld a 3.4 billion rouble ($134 million) lawsuit against Russneft for tax evasion, adding to state pressure on the embattled oil company. Lawyers for the company told reporters outside the court that they would appeal the decision. The hearings have been closely watched by analysts and market players for signals the private company could become the Kremlin's next target as the state seeks to increase control over the energy sector. Market players have speculated state-controlled oil major Rosneft could become the owner of mid-sized Russneft's assets should the state decide to go ahead with the firm's nationalisation. A close ally of the Kremlin, metals billionaire Oleg Deripaska has been also cited as a potential contender for the assets of the embattled company. In total, the Federal Tax Service has brought eight suits against 11 companies that are or previously were shareholders in Russneft. Russian media reported that the country's tax service claimed Russneft's shares were sold at knock-down prices to evade taxes and should therefore be nationalised, Reuters reported. Russneft produces 300,000 barrels per day of oil and is controlled by Russian businessman Mikhail Gutseriyev, with personal wealth of $3 billion according to Forbes magazine. In May he was personally charged with illegal activities and tax evasion.