Swiss multinational commodity trading group Glencore has confirmed it is in the final stages of negotiations over buying a 19.5% stake in state-owned Russian oil firm Rosneft.
The acquisition would be as part of a consortium with the Qatar Investment Authority and would be valued at US$11 billion (€10.2 billion), a 5% discount to Rosneft's estimated value as at 6 December, according to Rosneft CEO Igor Sechin.
In a statement, outling Russian President Putin's comments to Sechin yesterday, Putin said the deal was concluded and was well-timed, thanks to the oil price trending higher than it has been for some time.
The deal would include a five-year offtake agreement with Rosneft representing an additional 220,000 b/d for the Glencore Marketing business.
There would also be additional opportunities, through a strategic partnership for further cooperation, including infrastructure, logistics and global trading, says Glencore.
Glencore says the deal is yet to be agreed and is conditional on financing and approvals. However, Glencore says it could close mid-December.
According to the Financial Times, the deal is the largest under a privatization program launched by Russia at the start of the year and is one of the largest ever investments into the country.
Sechin said it is the largest asset sales transaction in the global oil and gas sector in 2016. It comes despite US and EU financial and technological sanctions against Rosneft.
In a statement issued by President Putin's office, Sechin says some 30 companies, foundations, investors and sovereign funds were approached as part of the part-privatization of Rosneft and a number of proposals submitted.
Image: Rosneft's activities in the Kara Sea.
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