Russia's GAZ To Turn Over Vast Plant To Make Opel Cars

MOSCOW (AFP)--Opel cars will be "made in Russia" after the Germany-based General Motors (GM) unit was sold on Friday to Canadian parts maker Magna (MGA) in a consortium bid with Russian auto maker GAZ (GAZA.RS). GAZ, Russia's second-largest car manufacturer, is poised to turn over its sprawling assembly line and distribution network to produce Opel cars for the Russian market. And while debt-laden GAZ won't itself put up any cash as part of the bid, the deal will also be partially financed in Russia, with state-run Sberbank putting up the rubles. For its part, GAZ brings to the table its industrial capacity and large assembly line, newly-built in 2008 with Magna's help in Nizhny Novogorod on the banks of the Volga river, 400 kilometres (250 miles) northeast of Moscow. Citing sources close to the deal, Russian business daily Vedomosti reported last week that the consortium would aim to produce 180,000 Opel cars at the plant. And analysts say the deal could breathe new life into the Soviet-era car maker as production grinds to a virtual halt at its factories amid falling demand. GAZ, controlled by indebted metals tycoon Oleg Deripaska's holding, Basic Element, remains Russia's largest producer of buses, trucks, road-construction equipment and heavy diesel engines. The company turned a profit of 153 billion rubles ($5 billion) in 2007, according to figures posted on its Web site. But despite recent efforts to develop new models, such as the Volga Sibir sedan, GAZ has struggled to compete with an influx of foreign imports. In addition, weighed down by the financial crisis, analysts estimate GAZ is more than $1 billion in debt, at least half of which is due this year. The car maker's "situation is critical", said Gennady Sukhanov, an automotive analyst with Troika Dialog. And as the Russian car market goes from bad to worse, manufacturers including GAZ have gone cap-in-hand to the state. In March, Prime Minister Vladimir Putin pledged RUB4 billion ($129 million) in state support for GAZ as part of rescue measures for the biggest players in the domestic auto industry. Analysts also believe the Kremlin was the main driving force behind the bid for Opel. The deal with GM for Opel "makes sense" for Moscow because it acquires foreign know-how and furthers its goal to promote investment overseas, said Chris Weafer, chief strategist at UralSib investment bank in Moscow. The full text Computer repair in Denver, Co. Cheap websites.

Natural gas in the Arctic is mostly Russian

By RANDOLPH E. SCHMID WASHINGTON (AP) — Nearly one-third of the natural gas yet to be discovered in the world is north of the Arctic Circle and most of it is in Russian territory, according to a new analysis led by researchers at the U.S. Geological Survey. "These findings suggest that in the future the ... pre-eminence of Russian strategic control of gas resources in particular is likely to be accentuated and extended," said Donald L. Gautier, lead author of the study published in Friday's edition of the journal Science. Russia is already the world's leading natural gas producer, noted Gautier, of the Geological Survey's office in Menlo Park, Calif. The report, by an international scientific team, estimated that the Arctic also contains between 3 and 4 percent of the world's oil resources remaining to be discovered. Two-thirds of the undiscovered gas is in just four areas — South Kara Sea, North Barents Basin, South Barents Basin and the Alaska Platform — the report said. Indeed, the South Kara Sea off Siberia contains 39 percent of the Arctic's undiscovered gas, the researchers said. Russia has been active in asserting its claim to parts of the Arctic. It first submitted a claim to the United Nations in 2001, but was rejected for lack of evidence. The United States, Canada, Denmark and Norway have also sought to assert jurisdiction over parts of the Arctic. The full text