Lithuania rejects Yukos request to delay Mazeikiu Nafta share purchase

Vilnius. (Interfax) - The Lithuanian government has rejected a Yukos request to delay the purchase of 9.72% of an additional share issue by Mazeikiu Nafta for 120 days.

The Lithuanian government's press service told Interfax that the government rejected the request based on the fact that the possibility of a delay is not envisioned in an investment contract in Mazeikiu Nafta, on the basis of which the purchase is being conducted.

Yukos asked the Lithuanian government to delay the purchase of 9.72% of an additional share issue by Mazeikiu Nafta for 120 days at a meeting between acting Economics Minister Petras Cesna and a Yukos RM executive.

Cesna said the Lithuanian government has no plans to draw out the process.

The owner of the Mazeikiu Nafta shares, Yukos Finance (registered in the Netherlands) announced it October it would exercise an option to buy 9.72% of Mazeikiu Nafta for $75 million, which would increase Yukos's share in the company to 63.4%.

Under an agreement with the Lithuanian government, Yukos had until October 29 to use its right to buy shares from an additional issue by Mazeikiu Nafta worth $75 million. If the first option was exercised the company would have until October 29, 2006 to exercise a second option for 11.5% of the company.

Mazeikiu Nafta posted net audited profit to US GAAP of 220.946 million litai in 2003, against 114.3 million litai in net losses in 2002. The company increased net audited profit 280% year-on-year to 448.2 million litai in January-September 2004.

Mazeikiu Nafta includes the Butinges oil terminal, the Mazeikiu Nafta refinery, the only refinery in the Baltic countries, and the Birzai oil pipeline. Yukos Finance owns 53.7% of Mazeikiu Nafta and the Lithuanian government owns 40.66%.
The litas is pegged to the euro at 3.4528 litai/EUR1.

(From Interfax, 12.2.2004)