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Yukos and Putin play last-chance poker

Arrested development: short of a last-minute
compromise Mikhail Khodorkovsky?s trial looks
set to run parallel with the dismantling of his
Yukos energy empire by the Kremlin

The high-stakes game of poker between jailed businessman Mikhail Khodorkovsky and Russian president Vladimir Putin entered its final round last month after bailiffs seized Yukos?s core production unit and threatened to sell it off at knockdown prices. Bailiffs seized Yukos?s Yuganskneftegaz production subsidiary on July 20 to pay off a $3.4 billion tax bill, relieving Russia?s second-biggest oil company of its main cash cow. The subsidiary accounts for 70% of Yukos?s oil reserves and 60% of production. It has also contributed most of Yukos?s double-digit production growth in recent years.

Analysts protested and Yukos?s management said that the company was now on the verge of bankruptcy. Yukos leaked a statement that claimed the court enforcers were planning to sell Yuganskneftegaz at its book value of $1.75 billion whereas independent estimates value it at closer to $16 billion ? far in excess of the outstanding tax bill.

The choice of Yuganskneftegaz is particularly galling as Yukos?s two other production units, Tomskneft and Samaraneftegaz, are valued at $3.6

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