Lithuania sells oil exploration firm

Jun 22, 2000

The Lithuanian State Property Fund signed an agreement on the sale of
a 81 percent stake in Geonafta with Naftos Gavyba, a consortium, on
June 16. Geonafta's share capital totals 24.28 million litas.

Naftos Gavyba is due to pay 60 percent of the money for shares within
30 working days, and complete the payment in four months. The
consortium has pledged to maintain at least 70 percent of jobs in the
company.

The consortium consists of the Polish companies Petrobaltic and
Energopol Trade, the Swiss finance and consulting firm Arada, the
Lithuanian brokerage firm Vivum, and the West Lithuanian Industry
and Finance Corporation.

Four bids had been submitted for Geonafta's privatization tender.
Naftos Gavyba came in second in the tender and was invited for talks
after Norway's Odfjell Drilling and Lithuania's SBA group dropped
out of the competition in early March, citing a lack of information
about Minijos Nafta and Genciu Nafta, which are co-owned by Geonafta.

The Lithuanian state will retain a special share in Geonafta for five
years. Geonafta posted a net profit of 3.48 million litas for the
year 1999. Its sales and services reached 32.6 million litas.

Geonafta produced around 50,000 tons of oil from three wells last
year, up from some 39,000 tons in 1998. The output amounted to 20,300
tons in the first five months of 2000. The company's recoverable
reserves amount to an estimated 1.1 million tons.

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