Yuganskneftegaz

Yuganskneftegaz began operations in 1964, and saw significant upgrades in the 1990s that are responsible for bringing its production to their current levels. Yuganskneftegaz was formerly owned by Yukos, which was broken up and its principal assets sold off to satisfy tax debts allegedly totaling $28 billion. On 19 December 2004, Yuganskneftegaz was sold at a state-run auction, ostensibly to satisfy tax debts. The winning, and sole, bidder, was a little-known Russian oil company called Baikal Finance Group, who paid $9.7 billion. It was later revealed that the previously unheard-of Baikal Finance Group is a group of Kremlin insiders headed by Igor Sechin, Deputy Head of the Presidential Administration and a close associate of President Vladimir Putin. On 22 December 2004, Baikalfinansgrup was purchased by Rosneft, a wholly state-owned Russian oil company. Sechin has been Chairman of Rosneft's Board of Directors since July 2004. The de facto nationalization of Yuganskneftegaz was denounced by Andrei Illarionov, then a senior Putin economic advisor, as "the scam of the year."