Oil and gas investors look toward Russia

By Hilton Price

Big money is being generated for investment in Russian oil and gas companies.

Reuters is reporting investors are raising funds for acquisition opportunities in Russia in the coming months, with one private equity player reportedly eyeing $1 billion to spend on the industry next year.

Investors are reportedly seeing opportunity in Russia, where promising significant internal rates of return is more possible than in other markets. The movement by private equity players may be spawned from recent movement from LUKOIL and Gazprom to reinvest large amounts back into the country.

Xenon Capital Partners has acknowledged it is raising a fund for acquisitions. The company’s managing director, Hamid Gayibov, says as the market recovers, International investors will see opportunity in Russian companies. And as larger companies are occupied with big projects, new opportunities will open for the country’s independent producers.

Gayibov says the company believes the market will see a noticeable turnaround and growth within the next five years.

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