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Russia Oil Company Chief Fired

May 28, 1998

MOSCOW (AP) _ The government fired the president and board chairman of Rosneft on Thursday, two days after canceling the sale of the state oil company because it received no bids.

Prime Minister Sergei Kiriyenko’s orders were related to the failure to attract any interest in Russia’s fifth-largest oil company, Russian news agencies said.

The government wanted to sell 75 percent of Rosneft, both to raise much-needed cash and to show that its privatization program is working.

Several oil companies said they were interested in taking the stake in Rosneft, but Russia’s young stock market has crashed since the sale was planned last fall and the price of oil has also plummeted on world markets.

The $2.1 billion price that attracted no bidders and was criticized as being too high.

The sale was seen as a major test for President Boris Yeltsin’s new Cabinet, which has said it would carry out further privatizations without bestowing any special favors on the country’s politically powerful commercial banks.

Kiriyenko fired Rosneft president Yuri Bespalov and board chairman Alexander Putilov, and replaced them with a Rosneft vice president and a deputy minister of fuel and power engineering.

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