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Bank Of America Investment Russian prosecutors on Thursday froze a 44 per cent block of shares in Yukos, the country's largest oil group, in a sharp escalation of the crisis surrounding the company and its owners.

By Voanews Russia's troubled oil company says it is being forced to slash production and expenditures because government has frozen its assets. Visit our AXcess News Forum and add your comments on this story. Try your hand at writing, the best story will be published on our news network. Take our business poll too! Print This Page Aug 24, 2004 (AXcess News) Russia's troubled Yukos oil company says it is being forced to slash production and expenditures because the government has frozen its assets.

Investment Opportunity The move, which was immediately denounced as illegal by the company, followed the arrest on Saturday of Mikhail Khodorkovsky, the chief executive and largest shareholder, on criminal charges of fraud and tax evasion totalling $1bn.

dollar project that aims to extract oil and gas from beneath the coast of far eastern Russia's Sakhalin Island. The oil giant Royal Dutch Shell is leading the investment on the island, - the same amount of remaining reserves in the North Sea. The company is seeking up to five billion dollars in financing for the project.

Banc Of America Investment Menatep, the holding company that controls the shares, said most belonged to international companies and were no longer owned by Mr Khodorkovsky.

Nov 28, 2004 (AXcess News) The State Committee on Development and Reforms of the People's Republic of China won't allow Chinese oil companies to take part in the auction for Yuganskneftegaz, the main production subsidiary of Russia's embattled Yukos oil company."A high level official from the currency department of the State Committee on Development and Reforms announced that the committee won't approve the participation of Chinese oil companies in the auction for a stake in Yuganskneftegaz, " the publication read.

Banking Investment The freezing of the shares triggered an 8 per cent drop in the RTS, the key Russian stock index, and fuelled concerns among overseas investors about the risks of doing business in Russia. Yukos shares fell nearly 14 per cent in Moscow.

Tax is the major impediment, says Ms Redman. The government levies an export duty of 65% at prices over $25 a barrel. Add to that various corporate, payroll and production taxes, oilmen complain, and the state creams off as much as 92% of profits. BP have argued that rising costs across the oil industry will make many investments in Russia unprofitable unless the tax regime is changed. As it is, BP accounts for a fifth of BP’s production, but only a tenth of its profits..

Investment Solution Strategic Yukos is the most significant of a number of Russian companies seeking investment by western counterparts. ExxonMobil and ChevronTexaco, the US oil groups, have both been in talks about taking a multibillion-dollar stake in the company.

In the United Kingdom, nearly a third of its power generation depends on natural gas. In 15 years, the UK will be dependent on Russia for 90 percent of its imported gas. Japan is almost totally dependent on imported energy sources and is heavily invested in Iran's Azadegan oil field. China has major investments in Iran, importing 13.6 percent of its oil requirements from that nation and, overall, 45 percent of its oil imports from the Middle East. China is also investing in Canadian tar sands projects.

Investment Banking Services Thursday's move was the latest action against the company by federal prosecutors - widely interpreted in Moscow as being politically motivated. One big question is whether such a campaign could be the beginning of a reversal of the 1990s privatisation of the Russian economy.

Bank Investment A leading Russian-based investment banker said: "This is potentially a very unstable situation. Every merger and acquisition deal has been put on ice. The market certainly has to fall much further."

Alternative Investment Vladimir Putin, the Russian president, who on Monday rejected calls from Russian business leaders to discuss the case, on Thursday night made efforts to calm the market at a previously planned meeting with international investment institutions.

Online Investment Services Stephan Newhouse, chairman of Morgan Stanley International, said Mr Putin gave an articulate summary of the government's programme.

Accompany Essential Investment "With regard to the recent Yukos events, he assured us that this does not represent a campaign against business nor any change in the government's commitment to the market economy and to support the property rights of individuals," Mr Newhouse said.

Investment Company According to one banker present, Mr Putin expressed clear economically liberal views, and stressed there was no attack on business as a whole and that it was important to preserve Yukos and not destroy its value.

Investment Management Solution However, Alexei Kudrin, Russia's reformist minister of finance and a key ally of Mr Putin, warned that "events are beginning to affect the markets", and called on judges involved in the cases to be "objective and balanced".

Investment Management Services The investigations risk sparking a political crisis. On Thursday night Mr Putin accepted the resignation of Alexander Voloshin as the head of the presidential administration. Mr Voloshin was seen as a counterweight to the hawkish siloviki faction in the Kremlin that has been behind the anti-Yukos campaign. Mr Voloshin was replaced by Dmitry Medvedev, a Putin loyalist.

Guide Investment Stock Mr Voloshin's departure heralds a shift in power away from those close to former president Boris Yeltsin in favour of Mr Putin's circle from his native St Petersburg. Anatoly Chubais, a leader of the liberal Union of Right Forces party who has criticised Mr Khodorkovsky's arrest, said: "This is serious. There are dangerous signs of the change of course in Russian politics."

Investment Manual Solution UES, the state-controlled Russian electricity monopoly, confirmed on Thursday that it had offered the job of executive chairman to Mr Voloshin.

Investment Stock In what some interpreted as a warning shot to Mr Chubais, the Federal Security Service on Thursday raided the offices of Novosibirskenergo, a regional subsidiary of UES.

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