Itera

ARETI International Group of Companies is a private energy company headquartered in Geneva, Switzerland. ARETI was created by Igor Makarov in 2015 as a result of rebranding of Itera International Group of Companies, which was started in 1992. The ARETI group company consists of holding companies registered in Cyprus, Virgin Islands, Curacao, and the Netherlands and has subsidiaries involved in the energy industry, civil and industrial engineering, and finance. Archived on compromat.ru as Свадебный велосипедист во главе Итеры: Нажми на Рема – получишь результат (Wedding cyclist at the head of Itera: Click on Rem - you will get the result). The company operates primarily in Switzerland and the Commonwealth of Independent States (CIS) countries. In 2013, its main subsidiary, Itera Oil & Gas Company, was acquired by Rosneft.

History

A firm which later became a part of the Itera Group was established in 1992 as a basic commodities trading company. Established in 1992, the Itera International Energy Corporation headquarters in Jacksonville, Florida keeps Makarov's wealth beyond the political and financial turmoil of Russia and the former Soviet states. In 1997, Itera Energy Corporation came under offshore ownership through four firms the Virgin Islands-based Lemar Industries (russian: Лемар Индастриз), the Nicosia, Cyprus-based Paltron Trading Ltd (russian: Палтрон Трейдинг Лтд), Omrania Trading Ltd. (russian: Омрания Трейдинг Лтд.), and Unirakon Trading Ltd. (russian: Юниракон Трейдинг Лтд.) which control the Curacao-based Itera Holding NV which controls the Netherlands-based Itera Holding B V. Makarov's Itera is associated to Itera Group through Omrania.

In 1994, it obtained the rights to sell Turkmeni natural gas as payment for its sugar transaction and started implementing gas-related projects within its subsidiary Itera Oil & Gas Company, LLC. In 1995, Itera began selling Turkmeni gas to Ukraine, Belarus, Moldova, and Georgia, as well as to the Baltic States over Gazprom pipelines in exchange for hard cash, sugar, meat, and cereals to Russia.

Registered in Wilmington, Delaware in May 1996, Itera International Energy LLS governs gas supplies and financial statements.

Registered in Riga, Latvia in November 1996, ITERA Latvia or ''ITERA Latvija'', which is headed by Juris Savitskis, governs gas supplies, pipelines and underground storage in Latvia and Estonia where it holds a large stakes in both the Latvian gas company '' Latvijas Gaas'' or ''Latvijas Gāze'' and the Estonian gas company '' Eesti Gaas''. Gazprom through its Latvian subsidiary established on 6 April 2009 in Riga, which was headed by Vladimir Putin's classmate at KGB training school and very close friend Sergei Roldugin's older brother Yevgeny Roldugin until the elder Roldugin's death due to COVID-19 complications on 15 November 2020, also holds large stakes in both Latvijas Gāze and Eesti Gaas.

In 1998, Itera launched production of natural gas in Yamalo-Nenets Autonomous Okrug in Western Siberia. It was the first private company to put gas fields into operation in the Far North of Russia: the Gubkinskoye gas field with reserves of in 1999; the Vostochno-Tarkosalinskoye field with reserves of in 2001; and the Beregovoye field with reserves of in 2003.

Due to enormous reserves, Makarov's Itera was the fourth largest natural gas company in the world in 2000.

In 2002, there was an agreement to merge the newly created gas company Novatek with Itera, but the deal was cancelled.

After the 5 December 2002 establishment of Eural Trans Gas, Itera was no longer the dominant natural gas provider to Ukraine.

In 2010, India-based Sun Group sold its 26% stake in Itera Holdings back to Itera Group.

In 2011, TNK-BP planned to acquire a 50% stake in Itera. This transaction failed. In 2012, Rosneft announced a plan to acquire up to 51% in Itera Oil & Gas.

In 2013, Rosneft acquired all shares in Itera Oil & Gas.

By mid-2015, Makarov had restructured and reenergized his remaining companies to enter a new stage of development. The Group was rebranded as the ARETI International Group (ARETI IG) to signal a new direction. Today, ARETI IG is composed of subsidiaries and affiliated companies with business interests in Russia, the CIS Countries, Baltic States, United States, Canada, Western Europe and in the Middle East. ARETI IG has offices located in Switzerland (Geneva), Russia (Moscow), Cyprus (Limassol), Belarus (Minsk), Turkmenistan (Ashgabat), Canada (Calgary) and the United States (Jacksonville).

Operations

Itera Oil & Gas Company

The main subsidiary of Itera was Itera Oil & Gas Company. It had aggregate proved reserves of of natural gas, over 2 million tons of gas condensate and 7 million tons of crude oil. By 2011, more than of natural gas had been produced in eight fields. It had 49% stake in Sibneftegaz (another shareholder is Novatek), which holds licences for exploration and production in the Yamal-Nenets region, including the Beregovoye field, Pyreinoye field, Zapadno-Zapolyarnoye field, and the Khadyryakhinskiy licence area.

Sibneftegaz owned the rights to develop oil and gas condensate fields with a total resource of of natural gas and 8.44 million tonnes of gas condensate.

In Sverdlovsk Oblast, the company operated through ZAO Uralsevergaz, a joint venture with the oblast administration. Together with Zarubezhneft, Itera carried out a development of block 21 in the Turkmen sector of the Caspian Sea. The reserves of this block were 219 million tons of oil, of natural gas and of associated gas. Together with Zarubezhneft and Rosneft, it developed blocks 29, 30 and 31.

Other activities

Since the mid-2000s, Itera group was involved in civil and industrial engineering in Russia, Belarus and Turkmenistan. Among the projects were an office complex for the 2014 Winter Olympic Games in Sochi, Russia, a skyscraper and a business center in Minsk, and sport facilities and pipelines in Turkmenistan and Russia. The company had commenced construction of a steam-gas power cogeneration plant with a capacity of 900 MW in the Nizhny Novgorod Region and for construction of a gas and petrochemical complex in the Urals with a capacity of 600,000 tons of methanol per year. In 2009, Itera's subsidiary MPK Engineering was contracted to build the Central Kara Kum–CS Yilanly gas pipeline in Turkmenistan. The pipeline was completed in 2010.

Since 2008, Itera, through its subsidiary Arkticheskiye razrabotki, developed Apsatskoe mineral coal mine, one of the largest in Russia, in Zabaykalsky Krai. Through its 72% stake in Stavropolstroynerud, it developed the Malkinsky quarry, located in Stavropol Region, with production capacity exceeding 1 million cubic meters of crushed stone, sand, and gravel per year. In 2011 100% of Arkticheskiye razrabotki were sold to SUEK, which became the new owner of Apsatskoe.

In the United States, Itera focused on oil and real estate, in addition to renewable energy sources, chemicals and bioenergy technologies.ITERA announced completion of financing for ethanol biorefinery in the USA
28 February 2008. In 2008, Itera put a bioethanol refinery into operation in Pennsylvania. The construction of a similar facility in Louisiana was planned, as well.

Corporate affairs

Structure

Itera Group Ltd. was registered in Cyprus. It owned Itera Holdings Limited, also registered in Cyprus, which owned 99.99% of Itera Oil and Gas Company, the main company of the group. In 2012 51% of Itera Oil & Gas were included into a joint-venture with Russian state-owned oil company Rosneft, which in 2013 also bought out remaining 49% from Itera Holdings Limited Altogether, Itera Group has dozens of subsidiaries in Russia, CIS, Asia, Europe and in the US. Its main shareholder, chairman of the board of directors and president is Igor Makarov.

Financials

In 2010, Itera had a gross profit of US$435.9 million and a net profit under IAS of US$226.9 million. Net sales amounted to US$1.6 billion, compared to US$1.15 billion in the previous year, and natural gas sales were RUR1.58 billion, compared to RUR1.13 billion in the previous year.

Sponsorships

Itera was a sponsor of the European Cycling Union (UEC). In March 2011, the UEC President Wojciech Walkiewicz and Igor Makarov, the chairman of the board of directors for Itera, signed a contract for financial support until the end of 2011, with the possibility of contract renewal.

In Russia, Itera was a long-term primary sponsor of the Russian Cycling Federation and it is one of the three key sponsors (along with Gazprom and Rostechnologii) of Russian cycling teams Katusha ProTour and Itera-Katusha continental, and two youth cycling teams, Itera-Katusha Under 21 and Itera-Katusha Under 23. With financial support from the Israeli-Canadian billionaire Sylvan Adams, the Makarov backed Swiss-based Katusha–Alpecin was taken over by the Israel Cycling Academy including its World Tour license in October 2019. From 2009 until October 2019, Makarov's ITERA had been a sponsor of Team Katyusha (russian: Катюша).

Itera signed an agreement with Gubkin Russian State University of Oil and Gas. According to the agreement, Itera provided grants to the best-performing students. The company also financed a number of scientific projects, and assists in providing technical equipment for the curricula.

Itera was one of the trustees of the Saint Petersburg Mining Institute, providing assistance in developing its educational and scientific base, preserving and renewing a group of historical buildings, repairing and constructing student dormitories and introducing innovative programs and technologies. Itera provided financial backing for constructing the Skolkovo Moscow School of Management.

Controversies

According to ''Bloomberg BusinessWeek'', in the late 1990s, the Russian state-controlled company Gazprom conducted dubious transactions with Itera and a Gazprom/Itera joint-venture, Purgaz. Billions of dollars of Russian natural gas resources were transferred from Gazprom to Itera for artificially low prices, then sold to the markets by Itera, allegedly profiting Gazprom managers who were also beneficiaries of Itera. In 2002, Bill Browder, manager of the Hermitage Capital Management investment fund, accused Itera and Gazprom of colluding to depress natural gas prices and also stock prices in a scheme that PricewaterhouseCoopers (PwC), which had been the in house auditor for Gazprom since 1996, could not uncover after PwC had produced dangerously lax audits of Gazprom. In February 2002, Boris Fyodorov, as an independent director of Gazprom, stated that PricewaterhouseCoopers (PwC) signed off on poorly performed audits of natural gas firm interactions such as Gazprom-Itera because PwC wanted to keep the account with Gazprom adding "If an auditor knows it cannot do a proper review, then it is just doing it for the money." Further, he said that any audits by Deloitte & Touche into the Gazprom-Itera interactions were strongly opposed by Gazprom management.

In March 2002, the U.S. Trade and Development Agency cancelled a $868,000 grant to Itera as questions were raised about its legitimacy. In May, Representative Curt Weldon led a congressional delegation to Russia and visited Itera. After his return, he publicly supported Itera's efforts. In the beginning of September 2002, Itera paid the expenses for Weldon to travel to New York City. The following week, Itera told Karen Weldon, the congressman's daughter, that it would sign a public relations contract for $500,000-a-year with her newly formed lobbying firm, Solutions North America, Inc. (SNA) which was signed on 30 September 2002. On 24 September 2002, Curt Weldon co-hosted an event at the Library of Congress honoring Itera's chairman. On 26 September, Weldon gave a floor speech praising Itera. On 30 September, SNA received a $500,000 annual contract with Itera, with $170,000 up front. In November 2002, Itera paid for Karen Weldon to join Rep. Weldon on a trip to Eastern Europe and Russia. In January 2003, Itera opened its newly expanded U.S. offices at Jacksonville, Florida, and paid for Rep. Weldon to attend the opening.

Notes

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{{Portal, Companies

Natural gas companies of Russia
Companies based in Moscow
Rosneft
1992 establishments in Russia
Privately held companies of Russia