Yukos asked for extra $9bn

RUSSIA’S biggest oil exporter OAO Yukos Oil will ask shareholders to consider declaring bankruptcy to protect assets after the government this week demanded an extra $9 billion in back taxes.

“The situation is unsustainable, we can’t continue much longer,” Chief Executive Steven Theede said in Moscow. The board yesterday scheduled a December 20 shareholder vote on whether to file for protection from creditors or liquidate Yukos, he said.

Yukos’s outstanding tax bill is $14 billion, more than the company’s market value. A bankruptcy filing may help Yukos survive a 16-month battle with the authorities by preventing government-mandated asset sales and giving the company as long as two years to pay off debt.

The dispute has cut exports from Russia, Europe’s biggest oil supplier, and may culminate in Mikhail Khodorkovsky, Yukos’s biggest owner, being jailed for 10 years for fraud.

The government in July said it may seize and sell OAO Yuganskneftegaz, which pumps 60% of Yukos’s oil, to help collect the tax bills.

“Declaring bankruptcy is clearly good because it will help to protect assets, or if need be, dispose of them in a more orderly fashion,’ said Alexander Branis, who helps manage $600 million in Russian assets at Prosperity Capital Management in Moscow, including Yukos shares.

Company shares fell 6.9% yesterday, taking the company’s value to $8.2 billion.