EMBATTLED Russian oil giant Yukos has been forced to file for bankruptcy in the United States, after the Russian government refused to back down in plans to auction its main production subsidiary.
Yukos filed for Chapter 11 bankruptcy in Houston yesterday. Spokesman Hugo Erikssen confirmed that the suit had been filed.
A Yukos statement said the auction of its production subsidiary on Sunday "will cause the company to suffer immediate and
irreparable harm".
"Yukos is asking the court for a temporary restraining order halting the planned auction of its Yuganskneftegaz subsidiary by Russian authorities," said the statement.
Chief executive Steven Theede called the move "the only resort" left for Yukos, which the Russian government has targeted in a relentless legal campaign that has sent the company’s value plunging.
The campaign against Yukos and its owners, including jailed former chief executive Mikhail Khodorkovsky, has been seen as a Kremlin-inspired effort to punish Khodorkovsky’s perceived political ambitions, including his funding of opposition parties.
President Vladimir Putin has cast the case as part of official crackdown on shady bookkeeping and corruption. Russian tax authorities say Yukos owes them a total of £15 billion.
Core subsidiary Yuganskneftegaz was scheduled to be auctioned to cover part of the bill and observers suggest the tax claims have been engineered to transfer the unit, which produces some 60 per cent of Yukos’ oil, to a Kremlin-connected company - most likely state gas giant Gazprom.
"The management of Yukos has worked tirelessly and in good faith over the past year to establish a dialogue with the Russian authorities," Mr Theede said.
"We have submitted more than 70 settlement offers and publicly stated that reorganisation was a distinct possibility if a reasonable resolution was not reached. It is regrettable that we did not receive one substantive response."
Yukos chose to make the filing in the US Bankruptcy Court for the Southern District of Texas, Houston Division, because Houston is a major international oil and gas centre, and Yukos has assets and business dealings in the area. In addition, it said, Yukos’ chief financial officer is working in Houston.
US bankruptcy law has worldwide jurisdiction over the debtor’s property and the company is seeking a judiciary that will protect the value of shareholders’ investment in Yukos, it said.
The full article contains 401 words and appears in Edinburgh Evening News newspaper.
