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Yukos Pays Off Quarter of Back Tax Bill

MOSCOW -- According to company managers, embattled Russian oil giant OAO Yukos has paid just under a quarter of its total $18.4 billion back tax bill for the 2000-2002 period, reported the Associated Press.

Speaking during a conference call with investors on Tuesday, CFO Bruce Misamore said Yukos had paid $3.9 billion of the government's total claim for back taxes for that period. Misamore also said tax claims of $6.7 billion in 2001 and $8.1 billion in claims for 2002 amount to 100 percent and 105 percent of the company's revenues, respectively, under the standards of generally accepted accounting principles.

As bailiffs collect revenues from Yukos's frozen bank accounts and a court order remains in place blocking the sale of assets, Yukos has been forced to delay current tax payments and slash investments as it whittles away at the back tax bill.

However, CEO Stephen Theede said Yukos, which is Russia's largest oil company, was pumping as usual and could pay down the taxes if simply given the time. But repeated proposals to the government, for more time and for alternate ways to pay the bill, had so far fallen on deaf ears, he said.

"The government doesn't want to be seen to be negotiating with us," Theede said. Commenting on the expected sale of core production unit Yuganskneftegaz against the bill, Theede found a glimmer of hope in the fact that bailiffs had not yet set a date. "The fact that it constantly gets pushed back gives us hope that there is some consideration being given to resolving this (in the government) that isn't illegal," he said.

Yukos has repeatedly said that any sale of Yuganskneftegaz would be illegal since non-core assets should be sold first.

The legal assault against Yukos and former CEO Mikhail Khodorkovsky is widely considered to be punishment for Khodorkovsky's political activities and an attempt for the state to reclaim lost influence in the strategically important sector by selling Yukos assets into Kremlin-friendly hands, according to the Associated Press.
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