Arkadiy Abramovich, 19, reportedly works as an intern at the London office of a Russian investment bank and this is thought to be his first big oil deal as he looks to make his mark in the Russian energy sector. Mr Abramovich Jr. is channelling the money to Zoltav through his private holding company, ARA Capital, which currently holds a 38.6 per cent interest in Zoltav.
Zoltav will use the money to advance the undeveloped Koltogor oilfield in Western Siberia, which it recently acquired in a $26m all-stock deal from CenGeo Holdings. CenGeo, a private company owned by Russian coal tycoon Valentin Bukhtoyarov, was recently issued a 25-year exploration and production licence for Koltogor.
Zoltav’s share price has climbed from a low of 50p a year ago to a high of 185p last week, following the deal’s completion. Investors must be betting Arkadiy Abramovich has as keen an eye for a deal as his father. Roman Abramovich acquired a majority stake in Russian oil group Sibneft for roughly $100m in the 1990s and sold it to Gazprom for $13bn in 2005.
Zoltav intends to shoot 3D seismic over the Koltogor Licence this winter before conducting a four-well appraisal drilling programme in 2015-2016. It also plans to begin test production during 2014 by re-opening a previously drilled well.
