As the world’s largest country in terms of area, Russia also has the world’s largest reserves of many natural resources. The country is blessed with an abundant supply of oil, natural gas, gold, diamond and other resources. In fact these resources exceed the reserves of commodity producing countries like Canada and Australia. However the vast majority of Russian resources remain untapped.
Since the disintegration of the USSR, some of its vast energy assets have been exploited to meet the growing demands of overseas markets especially Europe. Today Russia is one of the largest producers of oil and natural gas in the world earning the title “energy superpower”.
Since the Russian economy is concentrated heavily towards resources, most of the large Russian companies operate in the energy, mineral mining, metal sectors. The following is a summary of the largest 20 companies in Russia based on rankings by RussiaToday.com. I have listed the ticker if the company trades in any of the US exchanges.
Gazprom (OTCPK:OGZPY) is the world’s largest natural gas producer and distributor. Half of the company is owned by the Russian government. Gazprom produces about 85% of Russian gas and exports it to 27 countries mostly in Europe. Year-to-date the ADR is up 36%. In first quarter 2009, Gazprom’s profit fell 62% to 103.7 billion rubles (approx. $3.3B). Gazprom ADR does not pay dividends.
Russia’s largest oil producer is Rosneft. The company is engaged in the exploration, production and marketing of oil and related products. The government owns 75% of Rosneft.TNK-BP is Russia’s 3rd largest oil producer. TNK-BP was formed by the merger of BP’s Russian and Ukrainian operations with those of the Alfa, Access/Renova (AAR) group.
Lukoil (OTCPK:LUKOY) is a fully privately-owned oil and natural gas producer and marketer. Lukoil pays a dividend of 0.99%. In addition to Russia, it has operations in Azerbaijan, Kazakhstan, Uzbekistan, the Middle East, Colombia, and Northern and Western Africa.
Russia’s second largest natural gas producer is Novatek. Gazprom-Neft (GZPFY) is a vertically integrated oil company whose major shareholder is Gazprom. YTD the stock is up about 76%.The current yield is 4.82%. Surgutneftegas (OTCPK:SGTZY) is another oil exploration and production company.
2. Steel and Metal Companies
Novolipetsk Steel or NLMK
Magnitogorsk Iron and Steel Works or MMK
Norilsk Nickel (OTC: OTCPK:NILSY)
Polyus Gold (OTC: OTCPK:OPYGY)
Mechel Steel (NYSE:MTL)
Norilsk Nickel is engaged in the mining of base and precious metals including cobalt, rhodium, silver, gold, iridium and ruthenium. YTD Norilsk ADR has grown by 65%. Polyus Gold is Russia’s largest gold producer with operations mainly in Russia. Polypus Gold currently pays a 0.28% dividend. Mechel is a steel maker and mining company with interests in coking coal, iron ore and nickel. MTR fell below $5 late last year and has now recovered to $12+ range.
3.Other Sector Companies
Wimm-Bill-Dann (NYSE:WBD) - Russia’s biggest dairy, baby food and beverages company.
Sector: Grocery Retailing
Sector: Supermarket operations
Sector: Food Retailing
Sector: Fruit Juice and baby food manufacturing