Johannesburg –
Diversified miner Glencore says it has entered into a strategic partnership with
Qatar Investment Authority around Rosneft.
In a statement to
shareholders on Monday, the JSE-listed company says it and QIA have concluded
various agreements, which provide for the establishment of a 50:50 consortium.
The consortium
has, it says, entered into agreements in connection with the further
privatisation of Rosneft. This will see it buying a 19.5 percent interest in Rosneft
for €10.2 billion (R148 billion) from Rostneftegaz.
Last Wednesday,
Russia entered its largest privatisation deal ever when it said it would sell
19.5 percent of oil giant Rosneft for €10.5 billion euros ($11.3 billion) to
QAI and Glencore.
Glencore will initially
commit €300 million in equity, while QIA will commit €2.5 billion in equity to the
consortium. The balance will be committed once financing is finalised, Glencore
says.
Under the deal,
Glencore will achieve a new 5 year offtake agreement with Rosneft, which it
says represents a sizeable additional 220 000 bbls/day for the Glencore
Marketing business.
Glencore adds
there are also additional opportunities through a strategic partnership for
further cooperation, including infrastructure, logistics and global trading.
Read also: Kremlin sells Rosneft stake to Glencore
The deal,
subject to the usual conditions, is expected to close in mid-December 2016.
CEO Ivan
Glasenberg says “we are delighted that the strong relationships that already
exist between Rosneft, QIA and Glencore have enabled us to successfully enter
into this transaction. Glencore looks forward to working with both parties to
take advantage of the significant opportunities which are expected to be
presented across the Russian and global oil markets."
The value of the
gross assets the subject of the transaction attributable to Glencore is €5.1
billion.
Glencore notes
the deal is not connected with the recently announced privatisation by the
Russian government of Bashneft.