Exclusive: Rosneft raising money from Swiss trader as debt payment looms

Wed Feb 4, 2015 8:15am EST
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By Gleb Gorodyankin and Dmitry Zhdannikov

LONDON (Reuters) - Rosneft is raising money from Swiss trader Trafigura days before it must repay a $7 billion debt, industry sources said, seeking new funding options after the Russian central bank said its borrowing via the domestic bond market had added to pressure on the struggling rouble.

The Kremlin-controlled firm's ability to raise funds overseas has been severely curbed by sanctions imposed by Western powers which condemn Russia's annexation of Crimea and accuse it of orchestrating a rebellion in eastern Ukraine - a charge denied by Moscow.

The rapid devaluation of the rouble at the end of 2014, as the Russian economy struggled to cope with sanctions and the collapse of oil prices, compounded the financial squeeze on Rosneft.

But the Russian central bank has said the oil major actually added to the pressure on the currency when - in the run-up to the repayment of another $7 billion loan to Western banks in December - it raised over 600 billion roubles ($9 billion) by issuing rouble-denominated bonds.

Bank governor Elvira Nabiullina said the market was mistakenly expecting the company to buy dollars with the roubles raised, creating volatility. Rosneft, however, has denied any link between its bond issue and rouble volatility.

Now the Feb. 13 deadline for the repayment of another $7 billion loan to banks is nearing, and Rosneft is exploring alternative funding options including short-term financing, according to trading and oil industry sources.

Sanctions ban long-term financing of Rosneft - a measure that has prompted all Western companies to pull out of any such deals with the oil major - but allow short-term financing for a period of up to 30 days.

Under an existing five-year financing agreement with Trafigura which began in mid-2013, Rosneft sells 150,000-200,000 tonnes of oil a month to the trader - a deal which is allowed to continue because it was struck before sanctions were imposed.   Continued...

The logo of Russia's top crude producer Rosneft is seen on a gasoline station in Moscow, October 29, 2014. REUTERS/Maxim Shemetov