Page 97 - RusRPTOct19

would be integrated with the GPP in a single technology chain to process ethane and LPG into polymers for the domestic and global markets. According to the preliminary agreement, Gazprom will supply 1.5 mtpa of LPG and ethane fraction to the Amur GCC at formula-based prices. As a result, SIBUR will be able to increase its output from 1.5 mt of polyethylene to 2.3 mt of polyethylene and 400 kt of polypropylene. Earlier SIBUR and Gazprom signed a contract for the supply of ca. 2 mtpa of ethane fraction. The preliminary agreement will enable SIBUR to continue working on the extended version of its Amur GCC project and make a final investment decision by the end of 2019, while Gazprom will acquire a reliable consumer of valuable gas feedstock produced at the Amur GPP.
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Lukoil officially completes acquisition of 25% stake in Congo project.
Lukoil completed the acquisition of a stake in Marine XII, a hydrocarbon project on Congo’s continental shelf, according to the company’s press release. The project’s 2P reserves are 1,300mbbl of oil equivalent. Lukoil paid $800mn in cash. The project’s other shareholders are Eni (65%) and the state-owned Societe Nationale des Petroles du Congo (10%).
9.2.3 Aviation corporate news
Troubled Russian air carrier's UTAir debt restructuring talks with 11 banks have reached a dead end, according to the report by Vedomosti daily citing unnamed banking sources. As reported by bne IntelliNews, in June UTAir warned its creditors that it will not be able to fully repay the interest on loans worth RUB109.2bn ($1.7bn). Prior to that in April the carrier asked for more credit relief, trying to relapse bond repayment and banking loans by 35 years. Should UTAir fail to restructure its debt and be forced to bankrupt, the most likely candidate for its bail-out is Russian national air carrier Aeroflot. Another carrier Transaero that went bankrupt and was taken over by Aeroflot in 2015, with Aeroflot retaining almost all of its flight routes. Reportedly, the banks have rejected all of the refinancing schemes proposed by the carrier. Another possibility is to negotiate with the creditors one-by-one, with a response expected by September 30, sources told Vedomosti. UTAir could eventually buy out the debt to the smallest creditors, should it be able to negotiate a discount that satisfies them, other sources told the daily. UTAir is Russia's fourth largest airline with 1.1mn passenger turnover in January- February, following Aeroflot, S7 Group, and Urals airlines.
Aeroflot reported August operating data. Aeroflot group carried 6.4mn PAX in August (+7.1% – below the market’s +10.4% according to preliminary data provided by Rosaviation) and 41mn in Jan-Aug (+11.4%). In August, RPK was up 6.8% – notable slowdown vs July 7.7%. PLF stood at 90.2% (+0.2pp m/m), or 1.3pp below last year’s levels. No change is fleet in August, with total fleet 364 aircraft Analysis: 2H19 slowdown in line with guidance. Management maintains its 10% target for PAX growth in 2019, which indeed implies notable slowdown in 2H19. Largely slowdown is driven by the absence of the low base effect that was rather strong at the beginning of the year. Recovery of passenger load factor is minor and represent minor downside risks to our estimates.
97 RUSSIA Country Report October 2019 ww.intellinews.com