ARETI International Group
TypePrivate
IndustryOil and gas
Founded1992 (1992)
Headquarters
Geneva
,
Switzerland[1]
Number of locations
Switzerland, United States, Canada, Cyprus
Area served
Commonwealth of Independent States
Key people
Igor Makarov (Chairman)
ProductsNatural gas
Petroleum
ServicesGas Pipeline Transport
Websitewww.aretigroup.com

ARETI International Group of Companies is a private energy company headquartered in Geneva, Switzerland. ARETI was created by Igor Makarov in 2015 following his sale of Itera International Group of Companies, which was started in 1992 and sold off in 2013. The ARETI group company consists of holding companies registered in Cyprus, Virgin Islands, and the Netherlands and has subsidiaries involved in the energy industry, civil and industrial engineering, and finance.[2][3][4] The company operates primarily in Switzerland[1] and the Commonwealth of Independent States (CIS) countries. In 2013, its main subsidiary, Itera Oil & Gas Company, was acquired by Rosneft prior to any sanctions placed on Rosneft.[5][6]

History

A firm which later became a part of the Itera Group was established in 1992 as a basic commodities trading company.[2][7][8] Established in 1992, the Itera International Energy Corporation headquarters in Jacksonville, Florida kept Makarov's wealth beyond the political and financial turmoil of Russia and the former Soviet states.[2][8][9][10]

In 1994, it obtained the rights to sell Turkmeni natural gas as payment for its sugar transaction and started implementing gas-related projects within its subsidiary Itera Oil & Gas Company, LLC.[8] In 1995, Itera began selling Turkmeni gas to Ukraine, Belarus, Moldova, and Georgia, as well as to the Baltic States over Gazprom pipelines in exchange for hard cash, sugar, meat, and cereals to Russia.[9][11]

Registered in Wilmington, Delaware in May 1996, Itera International Energy LLS governed gas supplies and financial statements.[2]

Registered in Riga, Latvia in November 1996, ITERA Latvia or ITERA Latvija, which was headed by Juris Savitskis, governed gas supplies, pipelines and underground storage in Latvia and Estonia where it held a large stakes in both the Latvian gas company Latvijas Gaas or Latvijas Gāze and the Estonian gas company Eesti Gaas. Mr. Makarov exited the investment in 2013 when Itera Oil & Gas Company was sold off and has no relationship to ITERA Latvija since.

In 1998, Itera launched production of natural gas in Yamalo-Nenets Autonomous Okrug in Western Siberia. It was the first private company to put gas fields into operation in the Far North of Russia: the Gubkinskoye gas field with reserves of 399 billion cubic metres (14.1 trillion cubic feet) in 1999; the Vostochno-Tarkosalinskoye field with reserves of 407 billion cubic metres (14.4 trillion cubic feet) in 2001; and the Beregovoye field with reserves of 325 billion cubic metres (11.5 trillion cubic feet) in 2003.

Due to enormous reserves, Makarov's Itera was the fourth largest natural gas company in the world in 2000.[12]

In 2002, there was an agreement to merge the newly created gas company Novatek with Itera, but the deal was cancelled.

After the 5 December 2002 establishment of Eural Trans Gas, Itera was no longer the dominant natural gas provider to Ukraine.[13]

In 2010, India-based Sun Group sold its 26% stake in Itera Holdings back to Itera Group.[14] In 2011, TNK-BP planned to acquire a 50% stake in Itera.[15] This transaction failed.[16] In 2012, Rosneft announced a plan to acquire up to 51% in Itera Oil & Gas.[17] In 2013, Rosneft acquired the remaining 49% in Itera Oil & Gas. Following the complete sale of Itera Oil & Gas, Makarov was subject to a non-compete clause in the Russian energy sector.[5][6]

By mid-2015, Makarov had restructured and consolidated his remaining companies under ARETI International Group (ARETI IG). Today, ARETI IG is composed of subsidiaries and affiliated companies with business interests in the United States, Canada, Turkmenistan, Western Europe and in the Middle East. ARETI IG has offices located in Switzerland (Geneva), Cyprus (Limassol), Turkmenistan (Ashgabat), Canada (Calgary) and the United States (Jacksonville).

Operations

Itera Oil & Gas Company

The main subsidiary of Itera was Itera Oil & Gas Company. It had aggregate proved reserves of 510 billion cubic metres (18 trillion cubic feet) of natural gas, over 2 million tons of gas condensate and 7 million tons of crude oil. By 2011, more than 325 billion cubic metres (11.5 trillion cubic feet) of natural gas had been produced in eight fields.[18] It had 49% stake in Sibneftegaz (another shareholder is Novatek), which holds licences for exploration and production in the Yamal-Nenets region, including the Beregovoye field, Pyreinoye field, Zapadno-Zapolyarnoye field, and the Khadyryakhinskiy licence area.[19]

Sibneftegaz owned the rights to develop oil and gas condensate fields with a total resource of 395.53 billion cubic metres (13.968 trillion cubic feet) of natural gas and 8.44 million tonnes of gas condensate.[20] In Sverdlovsk Oblast, the company operated through ZAO Uralsevergaz, a joint venture with the oblast administration.[21] Together with Zarubezhneft, Itera carried out a development of block 21 in the Turkmen sector of the Caspian Sea.[22] The reserves of this block were 219 million tons of oil, 100 billion cubic metres (3.5 trillion cubic feet) of natural gas and 92 billion cubic metres (3.2 trillion cubic feet) of associated gas. Together with Zarubezhneft and Rosneft, it developed blocks 29, 30 and 31.[23]

Other activities

Since the mid-2000s, Itera group was involved in civil and industrial engineering in Russia, Belarus and Turkmenistan. Among the projects were an office complex for the 2014 Winter Olympic Games in Sochi, Russia, a skyscraper and a business center in Minsk, and sport facilities and pipelines in Turkmenistan and Russia.[24] The company had commenced construction of a steam-gas power cogeneration plant with a capacity of 900 MW in the Nizhny Novgorod Region and for construction of a gas and petrochemical complex in the Urals with a capacity of 600,000 tons of methanol per year.[25] In 2009, Itera's subsidiary MPK Engineering was contracted to build the 198.5-kilometre (123.3 mi) Central Kara Kum–CS Yilanly gas pipeline in Turkmenistan. The pipeline was completed in 2010.[26]

Since 2008, Itera, through its subsidiary Arkticheskiye razrabotki, developed Apsatskoe mineral coal mine, one of the largest in Russia, in Zabaykalsky Krai.[27] Through its 72% stake in Stavropolstroynerud, it developed the Malkinsky quarry, located in Stavropol Region, with production capacity exceeding 1 million cubic meters of crushed stone, sand, and gravel per year.[28] In 2011 100% of Arkticheskiye razrabotki were sold to SUEK, which became the new owner of Apsatskoe.

In the United States, Itera focused on oil and real estate, in addition to renewable energy sources, chemicals and bioenergy technologies.[29] In 2008, Itera put a bioethanol refinery into operation in Pennsylvania. The construction of a similar facility in Louisiana was planned, as well.[29]

Corporate affairs

Structure

Itera Group Ltd. was registered in Cyprus. It owned Itera Holdings Limited, also registered in Cyprus, which owned 99.99% of Itera Oil and Gas Company, the main company of the group.[30] In 2012 51% of Itera Oil & Gas were included into a joint-venture with Russian state-owned oil company Rosneft, which in 2013 also bought out remaining 49% from Itera Holdings Limited[31] Altogether, Itera Group has dozens of subsidiaries in Russia, CIS, Asia, Europe and in the US.[32] Its main shareholder, chairman of the board of directors and president is Igor Makarov.

Financials

In 2010, Itera had a gross profit of US$435.9 million and a net profit under IAS of US$226.9 million. Net sales amounted to US$1.6 billion, compared to US$1.15 billion in the previous year, and natural gas sales were RUR1.58 billion, compared to RUR1.13 billion in the previous year.[33]

Sponsorships

Itera was a sponsor of the European Cycling Union (UEC). In March 2011, the UEC President Wojciech Walkiewicz and Igor Makarov, the chairman of the board of directors for Itera, signed a contract for financial support until the end of 2011, with the possibility of contract renewal.[34]

From 2009 until October 2019, Makarov's ITERA had been a sponsor of Team Katyusha (Катюша).[35][36] With financial support from the Israeli–Canadian billionaire Sylvan Adams, the Makarov backed Swiss-based Katusha–Alpecin was taken over by the Israel Cycling Academy in October 2019.[35][37][38]

Controversies

According to Bloomberg BusinessWeek, in the late 1990s, the Russian state-controlled company Gazprom conducted dubious transactions with Itera and a Gazprom/Itera joint-venture, Purgaz. Billions of dollars of Russian natural gas resources were transferred from Gazprom to Itera for artificially low prices, then sold to the markets by Itera, allegedly profiting Gazprom managers who were also beneficiaries of Itera. In 2002, Bill Browder, manager of the Hermitage Capital Management investment fund, accused Itera and Gazprom of colluding to depress natural gas prices and also stock prices in a scheme that PricewaterhouseCoopers (PwC), which had been the in house auditor for Gazprom since 1996, could not uncover after PwC had produced dangerously lax audits of Gazprom.[39] In February 2002, Boris Fyodorov, as an independent director of Gazprom, stated that PricewaterhouseCoopers (PwC) signed off on poorly performed audits of natural gas firm interactions such as Gazprom-Itera because PwC wanted to keep the account with Gazprom adding "If an auditor knows it cannot do a proper review, then it is just doing it for the money." Further, he said that any audits by Deloitte & Touche into the Gazprom-Itera interactions were strongly opposed by Gazprom management.[39] Despite the allegations, PricewaterhouseCoopers (PwC) defended the audit reports and the Moscow Arbitration Court threw out all five suits filled by Bill Browder against Gazprom in June 2002. "A Moscow Arbitration Court judge has thrown out five lawsuits that minority shareholder activist William Browder filed against Big Four auditing firm PricewaterhouseCoopers. We hope we’re at the end of it, these decisions are pretty definitive." said PwC managing partner Richard Buski.[40]

In March 2002, the U.S. Trade and Development Agency cancelled a $868,000 grant to Itera as questions were raised about its legitimacy. In May, Representative Curt Weldon led a congressional delegation to Russia and visited Itera. After his return, he publicly supported Itera's efforts. In the beginning of September 2002, Itera paid the expenses for Weldon to travel to New York City. The following week, Itera told Karen Weldon, the congressman's daughter, that it would sign a public relations contract for $500,000-a-year with her newly formed lobbying firm, Solutions North America, Inc. (SNA) which was signed on 30 September 2002. On 24 September 2002, Curt Weldon co-hosted an event at the Library of Congress honoring Itera's chairman. On 26 September, Weldon gave a floor speech praising Itera. On 30 September, SNA received a $500,000 annual contract with Itera, with $170,000 up front. In November 2002, Itera paid for Karen Weldon to join Rep. Weldon on a trip to Eastern Europe and Russia. In January 2003, Itera opened its newly expanded U.S. offices at Jacksonville, Florida, and paid for Rep. Weldon to attend the opening.[41] Investigations have found no wrongdoing by Itera or any of its associates.

Notes

    References

    1. 1 2 Meyer, Carl; McIntosh, Emma (3 March 2022). "SNC-Lavalin, Kinross Gold among Canadian players still dealing in Russian resources". The Narwhal.
    2. 1 2 3 4 Степовой, Сергей (Stepovoy, Sergey) (March 2000). "Труба зовет. Туркменский след украинских событий" [The Trumpet Calls. Turkmen trace of Ukrainian events]. Stringer Стрингер (in Russian). Retrieved 20 August 2021.{{cite news}}: CS1 maint: multiple names: authors list (link) Archived on compromat.ru as Свадебный велосипедист во главе Итеры: Нажми на Рема – получишь результат (Wedding cyclist at the head of Itera: Click on Rem – you will get the result).
    3. ↑ Федоров, Б. (2000). Приложение №4 [Appendix No. 4]. FreeLance Bureau (flb.ru) (in Russian). Archived from the original on 5 March 2001. Retrieved 11 September 2021.
    4. ↑ Федоров, Б. (2000). "Семейные тайны приватизации "Газпрома": "Кошелек" газпромовской "Семьи"" [Family secrets of Gazprom privatization: "Wallet" of the Gazprom "Family"]. FreeLance Bureau (flb.ru) (in Russian). Archived from the original on 9 November 2000. Retrieved 11 September 2021.
    5. 1 2 Devitt, Polina; Golubkova, Katya (2 July 2013). "Rosneft buys rest of Itera from founder for $2.9 billion". Reuters.
    6. 1 2 "Rosneft buys control of Itera Oil & Gas". Oil & Gas Journal. PennWell Corporation. 3 July 2013.
    7. ↑ "Itera: The Company". Itera website. Archived from the original on 25 March 2004. Retrieved 14 November 2020.
    8. 1 2 3 "Itera: Who Are We and What Do We Do". Itera website. Archived from the original on 26 September 2011. Retrieved 14 November 2020.
    9. 1 2 "Tinker, tailor, cyclist, spy". INRNG. The Inner Ring. 29 December 2011. Archived from the original on 9 January 2012. Retrieved 13 November 2020.
    10. ↑ Тёртый, Василий (Tyorty, Vasiliy) (2015). "КРИМИНАЛЬНАЯ ЭЛИТА УКРАИНЫ" [Ukrainian Criminal Elites] (PDF). «Самотёка», МИД «Осознание» (in Russian). Moscow. Retrieved 6 April 2022.{{cite web}}: CS1 maint: multiple names: authors list (link)
    11. ↑ History. Archived 26 September 2011 at the Wayback Machine
    12. ↑ Weiss, Michael (19 March 2014). "Married to the Ukrainian Mob: Meet Dmytro Firtash, the shady billionaire at the heart of Russia's energy stranglehold over Kiev". Foreign Policy. Archived from the original on 11 July 2020. Retrieved 18 November 2020.
    13. ↑ Global Witness 2006, pp. 33–36, 40–41.
    14. ↑ P B Jayakumar (7 October 2010). "Sun Group to exit Itera". Business Standard. Retrieved 21 July 2012.
    15. ↑ "TNK-BP Mulls Itera Stake to Up Gas Output". The Moscow Times. Bloomberg. 10 August 2011. Retrieved 21 July 2012.
    16. ↑ Kristalinskaya, Svetlana (April 2012). "Itera Aims to Get Back Its Own New Rosneft-Itera JV to Challenge NOVATEK for Top Spot on the Independent Gas Producers Market". Oil & Gas Eurasia. Archived from the original on 22 July 2012. Retrieved 22 July 2012.
    17. ↑ "Rosneft takes Itera slice". Upstream Online. NHST Media Group. 20 July 2012. Retrieved 21 July 2012.
    18. ↑ Developing Far North & Western Siberia. Iteragroup.com. Archived 3 June 2011 at the Wayback Machine
    19. ↑ "Novatek seals Sibneftegaz stake". Upstream Online. NHST Media Group. 17 December 2010. Archived from the original on 2 October 2012. Retrieved 21 July 2012.
    20. ↑ Soldatkin, Vladimir (16 November 2010). "Russia's Novatek to pay $900 mln for Sibneftegaz". Reuters. Retrieved 21 July 2012.
    21. ↑ ITERA: a course to a vertically integrated business. Itera.ru.
    22. ↑ "Itera sees big spend on Block 21". Upstream Online. NHST Media Group. 14 April 2010. (subscription required). Archived from the original on 14 February 2016. Retrieved 21 July 2012.
    23. ↑ Afanasiev, Vladimir (22 May 2008). "Hidden jewels likely to lie offshore but warnings sounded that treasure chest may not be complete". Upstream Online. NHST Media Group. (subscription required). Archived from the original on 7 January 2015. Retrieved 21 July 2012.
    24. ↑ Itera. Itera.ru. Archived 20 July 2011 at the Wayback Machine
    25. ↑ ITERA: orientation to vertically integrated business, 9 June 2010.
    26. ↑ "Itera ends Turkmen pipe test". Upstream Online. NHST Media Group. 13 August 2010. (subscription required). Retrieved 21 July 2012.
    27. ↑ ITERA is in active development stage of Apsatski field, 15 June 2010.
    28. ↑ Malkinsky quarry. Iteragroup.com. Archived 31 March 2012 at the Wayback Machine
    29. 1 2 ITERA announced completion of financing for ethanol biorefinery in the USA Archived 29 September 2011 at the Wayback Machine, 28 February 2008.
    30. ↑ "ITERA GROUP completed the deal to buy out a participation of SUN, an Indian company, with ITERA HOLDING" (Press release). Itera. 28 January 2011. Archived from the original on 16 April 2013. Retrieved 21 July 2012.
    31. ↑ "Rosneft Buys Remaining 49% Stake in Itera for $2.9 BLN".
    32. ↑ "ITERA". Archived from the original on 29 September 2013. Retrieved 7 November 2013.
    33. ↑ ITERA Increased the 2010 Net Profit Under IAS by 43 Percent up to US$ 226.9 Million, Prime-TASS, 25 July 2011. Archived 31 March 2012 at the Wayback Machine
    34. ↑ New sponsor of European Cycling Union! Archived 26 September 2011 at the Wayback Machine, 23 February 2011.
    35. 1 2 Malach, Pat; Farrand, Stephen (2 October 2019). "Israel Cycling Academy complete Katusha-Alpecin takeover: Dan Martin and Nils Politt set to lead new-look WorldTour team in 2020". VeloNews. Retrieved 13 November 2020.
    36. ↑ Katusha Youth. Archived 23 August 2011 at the Wayback Machine
    37. ↑ Hood, Andrew (10 July 2019). "Azevedo denies reports that Katusha-Alpecin could disband: With important sponsors leaving, the future of Katusha-Alpecin is far from secure, but staffers deny the team has given up hope". VeloNews. Retrieved 10 December 2019.
    38. ↑ Trembley, Philippe (26 September 2019). "Israel Cycling Academy set to acquire Katusha's WorldTour license: Israeli-Canadian Sylvan Adams has been motivated to get his team to the Tour de France report". Canadian Cycling Magazine. Retrieved 13 November 2020.
    39. 1 2 Starobin, Paul; Belton, Catherine (18 February 2002). "Gazprom: Russia's Enron? Gazprom and PricewaterhouseCoopers are under fire". Bloomberg BusinessWeek. Archived from the original on 15 February 2002. Retrieved 17 August 2021.
    40. ↑ "Court Throws Out Broder's 5 PwC Suits". The Moscow Times. 21 June 2002. p. 2.
    41. ↑ "Lucrative Deals for a Daughter of Politics". Los Angeles Times. 20 February 2004. Archived from the original on 2 November 2009. Retrieved 18 August 2021.

    Sources

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