Page 7 - FSUOGM Week 07 2021
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FSUOGM PIPELINES & TRANSPORT FSUOGM
Transneft risks losing
Belarusian diesel pipe
RUSSIA RUSSIA’S Transneft risks losing control of its 6mn tonnes per year in 2019 to only 3.4mn tpy
diesel pipeline running through Belarus, as in 2021-2024.
The pipeline is its subsidiary operating the infrastructure is These conditions mean the business is
unprofitable as a result on the brink of bankruptcy following a hike in unprofitable, Grishanin said, estimating annual
of increased taxes and local taxes, Kommersant reported on February losses at $11mn. The business also faces a greater
reduced volumes. 11. administration burden, with Belarusian authori-
Zapad-Transnefteprodukt, the pipeline’s ties having increased the number of requests and
operator, was slapped with a new environmen- checks it has to deal with significantly since the
tal tax following the Druzhba dirty oil crisis in start of last year.
2019. Beginning January 1, 2020, the company Transneft warns that in these conditions,
has had to pay RUB0.35 for every tonne of diesel Belarus could initiate bankruptcy proceedings
per 100 km transported. Minsk has also tripled against Zapad-Transnefteprodukt when its net
its income tax rate from 18% to 50%. Only one asset value becomes negative. Its current asset
other company has to pay this higher rate, and value is estimated at RUB6.7bn ($90mn).
that is Gomeltransneft Druzhba, a Belarusian “We treat the news as potentially negative for
state-owned pipeline operator that pays its prof- Transneft, although we do not expect any imme-
its to the Belarusian budget anyway. diate effect on the company’s financials,” analysts
“We have been working for a long time at VTB Capital (VTBC) said. “We note that the
through the Ministry of Energy and a high-level annual loss of RUB0.8bn deducts RUB110 per
commission to abolish this tax, because it is share from the annual dividends. If the company
discriminatory,” Transneft’s first vice-president opts to write off the asset, this might lower the
Maxim Grishanin told Kommersant. Making dividends by some RUB900 per share ... which
matters worse, Transneft expects volumes trans- is equivalent to the loss of 0.6% of dividend
ported through the pipeline to decline from yield.”
PERFORMANCE
Bashneft posts $154mn loss in 2020
RUSSIA BASHNEFT, an oil producer of Bashkiria repub- (Bashkiria). The company and its solid cash flow
lic in Russia, reported a $154mn loss under IFRS and dividend payout were in focus after a dra-
Bashneft is more for 2020. The company's loss for Q4 2020 alone matic takeover by Russian state oil major Ros-
exposed to refining than stood at $94mn. neft from private investment conglomerate AFK
any other integrated oil VTB Capital (VTBC) analysts on February Sistema and a corporate conflict that was finally
company in Russia. 15 noted that even as Bashneft's results were settled in March 2018.
anticipated to be weak, they were lower than Currently Rosneft owns 57.66% in the
expectations, with Ebitda missing the analysts' company, with 25% held by Bashkiria's local
forecast by 22%. government, 8% treasury shares, 4.4% held by
Bashneft is more exposed to refining (as companies affiliated with Bashneft, and about
opposed to crude oil sales) than any other 4% held by minority shareholders.
integrated oil company in Russia, and the final As reported by bne IntelliNews, Rosneft itself
quarter of 2020 was not favourable for the suffered a near 80% drop in net profit in 2020, as
downstream segment, especially domestically the coronavirus (COVID-19) pandemic sapped
in Russia. fuel demand and caused prices to collapse.
In addition, the negative bottom line for
Bashneft was exacerbated by other expenses and
a foreign currency loss. VTBC analysts warn that
Bashneft is unlikely to pay dividends for 2020
given the net loss (official dividend payout policy
of 25% of IFRS net income), and affirm a Hold
recommendation on the company's shares.
Bashneft is consolidating its oil extrac-
tion assets in the Republic of Bashkortostan
Week 07 17•February•2021 www. NEWSBASE .com P7
