Russia’s state-owned oil giant Rosneft paid $250 million to a mysterious external consultant to help secure deals in Iraqi Kurdistan, Bloomberg reports citing previously unreleased documents.
The papers shed new light on transactions that have strengthened Moscow’s presence in the Middle East, the news outlet writes.
The fee was linked to deals that helped Rosneft become the dominant foreign player in the Kurdish oil industry. In the process, they drew Russia deeper into Iraq just as President Vladimir Putin was seeking to bolster the Kremlin’s position in the region at Washington’s expense.
The amount is large by the standards of financial advisory contracts. For comparison, the entire M&A advisory fees of the top 12 global investment banks in the Middle East and North Africa amounted to about $400 million last year, according to analytics firm Coalition Development Ltd.
The $250 million was paid over the course of 2017 and 2018 by the Russian oil company’s Swiss subsidiary, Rosneft Trading SA, the same unit the U.S. imposed sanctions on last month. The fee was disclosed a few weeks ago in the financial statements of a Singaporean subsidiary created by the oil giant as a holding company for its investments in Kurdistan. The consultant wasn’t named.
Rosneft said all deals were subject to inclusion in the consolidated accounts of the parent company, and those of its subsidiaries. It added: “In line with legal requirements, the reports go through all the necessary audits (including tests of whether information on completed deals is provided in full, and whether the deals are consistent with market conditions and are economically viable).”
A spokesman at the Kurdistan Regional Government’s finance ministry declined to comment.
Rosneft advanced as much as $3 billion to the government of Iraqi Kurdistan in exchange for future oil supplies in 2017 and 2018, providing important funds to the restive region of northern Iraq.
