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Novatek Won't Get Gas Export Rights

Novatek will not get rights to export gas from Russia under a deal Gazprom asked its shareholders to approve at its annual meeting, Sergei Kupriyanov, a Gazprom spokesman, said Friday.

Novatek may get rights to ship gas across Kazakhstan and back into Russia, Kupriyanov said.

The company's shares jumped as much as 7.9 percent on the MICEX after Interfax reported that Novatek, Russia's second-largest gas producer, could get rights to sell abroad from Gazprom, the gas export monopoly.

Novatek's closed up 2 percent, ahead of the broader market.

Before the clarification, Moscow-based brokerage RMG wrote in a research note that Novatek could have earned at least $1 billion to $1.5 billion in additional operating income in 2011 by exporting to foreign markets.

Domestic prices averaged about $60 per 1,000 cubic meters last year, the note said. Average export prices to former Soviet countries was $202, while the EU paid about $288.

(Bloomberg, MT)

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