Digest of headline news from December 2 to 11:30 a.m. Moscow time on December 3:
BUSINESS & FINANCE
*** Dollar unchanged, euro edges up against ruble
The dollar is unchanged and the euro is edging up against the ruble in early trading on the Moscow Interbank Currency Exchange (MICEX) Tuesday.
The dollar traded at 33.24 rubles/$1 after the first minute, level with yesterday's closing and 9 kopecks above today's official rate.
The euro began the day at 45.03 rubles/EUR1, 5 kopecks above yesterday's closing and 6 above the official rate.
The bi-currency basket ($0.55 and EUR0.45) started the day at 38.54 rubles, up 2 kopecks from yesterday's closing value.
*** Russian shares down, MICEX and RTS indexes fall 0.6%-0.7%
Russian shares are falling in early trading on Tuesday on the back of yesterday's losses on Wall Street.
The MICEX stock index was down 0.6% to 1464.22 and the RTS was off 0.1% to 1389.22 after the first minute of trading.
*** RUSSIAN RESERVE FUND UP 91 BLN RUBLES, WELFARE FUND UP 78 BLN RUBLES IN NOV - MINFIN
Russia's sovereign Reserve Fund contained just over 2.885 trillion rubles ($86.93 billion) and the National Welfare Fund (NWF) just under 2.923 trillion rubles ($88.06 billion) on December 1, up from 2.794 trillion rubles ($87.15 billion) and 2.845 trillion rubles ($88.74 billion), respectively, on November 1, the Finance Ministry said.
In other words, the Reserve Fund grew 91 billion rubles and the NWF grew 78 billion rubles during November.
*** PUTIN: CUSTOMS UNION ALREADY BRINGS REAL DIVIDENDS TO RUSSIA, KAZAKHSTAN, BELARUS
Russian President Vladimir Putin has noted a positive effect from the Customs Union of Russia, Kazakhstan and Belarus.
"Membership in the Customs Union and the Common Economic Space has brought tangible dividends to Russia, Kazakhstan and Belarus," he said at the Third Russian-Armenian Forum in Gyumri on Monday.
*** AUDIT CHAMBER PUTS LOST REVENUE DUE TO UNRESOLVED GAS ISSUE AT SAKHALIN-1 AT $3.6 BLN
The board of Russia's Audit Chamber (AC) reviewed the results of an audit of the performance of the government and companies operating projects being carried out under production sharing agreements (PSA) in 2012.
The fiscal watchdog said that at the Sakhalin-1 project the issue of selling natural gas from the Chaivo field has still not been resolved. "As a result, revenues not received by the government have already reached $3.6 billion," the AC said in a press release.
*** RUSSIAN GOVT GIVES ROSNEFT RIGHTS TO TWO SEA OF OKHOTSK BLOCKS
The Russian government has decided to grant state oil major Rosneft the rights to the Amur-Limansky and Vostochno-Pribrezhny blocks with federal status, located respectively in the Amur estuary and Nabilsky Bay in the Sea of Okhotsk, the relevant orders show.
According to these documents, the government has confirmed the results of auctions for these blocks presented by the Natural Resources Ministry, recognizing Rosneft as the winner.
The rights to explore for and extract hydrocarbons at these blocks will be exercised under a combined license.
*** GAZPROM, VITOL MIGHT TEAM UP IN FRENCH, UK ELECTRICITY SECTOR
Gazprom and trader Vitol have outlined steps to work together in generating electricity with Russian gas, the Russian gas giant said.
Such agreements were reached at a meeting between Gazprom CEO Alexei Miller and Vitol head Ian Taylor.
The companies already work together in underground gas storage in Europe and discussed further developing this business, and have looked at the "potential for cooperation in the area of gas-fired power generation, particularly in Britain and France."
*** FORTUM STARTS UP SECOND 424 MW UNIT AT NYAGAN DISTRICT POWER PLANT
Fortum has begun commercial operation of the second power block at the Nyagan district power plant (Nyagan 2) in Khanty-Mansii autonomous district with 424 megawatts certified capacity, the company said in a statement.
"Nyagan 1 has been in commercial operation since 1 April 2013 and the construction of Nyagan 3 is planned to be finalized by the end of 2014," the statement says.
Alongside electricity sales on the wholesale market, Fortum will receive capacity payments beginning on December 1, 2013.
*** RUSSIAN-CZECH JV TO INVEST 2.3 BLN RUBLES IN MACHINE-TOOL PLANT IN AZOV
MTE Kovosvit MAS, a joint venture between Russia's MTE and the Czech Republic's Kovosvit MAS, plans to complete the creation of a machine-tool manufacturing facility in the Rostov Region city of Azov by the middle of 2015 at a cost of 2.3 billion rubles.
"The investment program is intended to run to the end of the first half of 2015. We are investing a total of about 2.3 billion rubles. The amount of investment carried out so far exceeds 500 million rubles," LLC MTE Group chief executive Denis Volkov said at a ceremony to mark the launch of an assembly line at the new enterprise on Friday.
*** MAZEPIN BUYING 20% OF URALKALI
The main owner of the UralChem group, Dmitry Mazepin, has reached agreement in principle to acquire 20% of the charter capital in fertilizer-maker OJSC Uralkali (MOEX: URKA).
An UralChem statement says the deal involves company GDR belonging to organizations associated with Filaret Galchev and Anatoly Skurov. The parties are looking to finalize the transaction soon.
*** ACRON REDUCES STAKE IN URALKALI TO 1.77%, NETS $170 MLN
Acron (MOEX: AKRN) has reduced its stake in Uralkali (MOEX: URKA) to 1.77% from 2.88%, Acron said in a statement.
It received 5.5 billion rubles (about $170 million) for the shares.
*** RUSSIAN GOVT SELLS 0.2% OF SHARES IN VOZROZHDENIE BANK FOR 22.5 MLN RUBLES
Russia's Federal Property Agency has sold 58,152 common shares in Vozrozhdenie Bank at auction to Rye, Man & Gor Securities for 22.5 million rubles, agency materials show.
The bank's charter capital is 250,431,099 rubles split into 23,748,694 common and 1,294,505 preferred shares with par value of 10 rubles each. The agency therefore sold a 0.2% stake in the bank.
*** Energy minister sure natural gas for Ukraine will be 10-15% cheaper in 2014
Ukraine hopes that negotiations with Russia on a reduction in the price of natural gas will be successfully completed by the end of the year, but even if they fail, the country will manage to achieve a reduction in the cost of natural gas next year by 10-15%, Ukrainian Energy and Coal Industry Minister Eduard Stavytsky said.
"I'm confident that next year we will be able to reduce the price by 10-15%, and this is not only due to negotiations with Russia," he said in an interview with Channel 5.
*** Rosneft, Armenia's Oil Techno sign shareholder agreement on fuel JV
Rosneft (MOEX: ROSN) and Armenia's Oil Techno have signed the shareholders agreement for a joint venture that will supply Armenia with fuel.
Rosneft said in a press release that its president, Igor Sechin, and Arthur Alaveryan, president of Oil Techno, signed the agreement.
"The JV's primary objective will be to provide Armenia with stable supplies of high quality petroleum products through wholesale and retail operations within the territory of the country as well as through the development of corresponding infrastructure for storage and distribution of petroleum products in Armenia," Rosneft said.
POLITICS & SOCIETY
*** MOSCOW TO STRENGTHEN ITS POSITION IN SOUTH CAUCASUS - PUTIN
Russia intends to strengthen its position in the South Caucasus, President Vladimir Putin said at the Russian-Armenian Interregional Forum.
"As to the South Caucasus, Russia has never planned to leave it. On the contrary, we are going to strengthen our position in the South Caucasus," Putin said.
*** RUSSIA IMPOSES SANCTIONS ON NORTH KOREA - PRESIDENTIAL DECREE
President Vladimir Putin has signed a decree introducing additional sanctions on North Korea in compliance with UN Security Council Resolution 2094 of March 7 2013.
The decree says that restrictions have been imposed on the Democratic People's Republic of Korea where a nuclear test was carried out, in line with the Federal Law on Special Economic Measures.
*** Oleg Plokhoi appointed to head counter-corruption directorate
Russian President Vladimir Putin has appointed Oleg Plokhoi as the head of the presidential counter-corruption directorate, a source in the Kremlin press service told Interfax on Tuesday.
Earlier reports said the president had established the counter-corruption directorate at his administration and approved the directorate's regulations.
*** MISSILE DEFENSE SYSTEM IN EUROPE "IS GROWING" - GRUSHKO
The beginning of the practical implementation of the construction of the missile defense system in Europe cannot help but cause concerns in Russia, Russia's Ambassador to NATO Alexander Grushko told Interfax in Brussels on Monday.
"We see that the U.S./NATO missile defense system in Europe is gradually 'growing muscle.' It is not clear when this process will stop. Decisions on the implementation of this or that phase are made primarily with regard for the maturity of the relevant technologies and the feasibility of technical solutions," the diplomat said.
*** RUSSIA-NATO COUNCIL WILL DISCUSS PROSPECT OF IMPLEMENTING PRACTICAL COOPERATION PROJECTS
Russia expects that the Russia-NATO ministerial council on December 4 will discuss such vital issues in the relations of the sides as the fulfillment of resolutions of the Lisbon summit of the council and further implementation of practical cooperation projects, Russian envoy to the North Atlantic alliance Alexander Grushko has said.
"As for international security issues, the continuation of the discussion of the most topical of them - the situations in Syria and Afghanistan - is expected," he said in a Monday interview with Interfax in Brussels.
*** SHOIGU TO DISCUSS MILITARY-TECHNOLOGICAL COOPERATION IN GREECE
Russian Defense Minister Sergei Shoigu will pay an official visit to Greece on December 2-3, Russian Defense Ministry's press secretary Maj. Gen. Igor Konashenkov.
"The Russian defense minister is going to meet Greek National Defense Minister Dimitrios Avramopoulos and Greek Prime Minister Antonios Samaras," Konashenkov said.
*** LIBYA IS READY FOR RE-OPENING OF RUSSIAN EMBASSY IN TRIPOLI - FOREIGN MINISTER
Libya is ready for the re-opening of Russian Embassy in Tripoli, Libyan Foreign Minister Muhammad Abdel-Aziz said.
"We are having intensive consultations with the Russian government, primarily with the Foreign Ministry, on the return of the embassy to Libya. We were told that a decision has been made on its return," the Libyan foreign minister told the Voice of Russia radio.
*** PEACE IN ARCTIC IS RUSSIA'S FUNDAMENTAL INTEREST - MINISTRY
Peace, stability and cooperation in the Arctic region are Russia's fundamental interests, Russian Foreign Ministry's ambassador-at-large, Russia's envoy to the Arctic Council Anton Vasilyev said.
"Thanks to the efforts of all Arctic States the general situation in the region has changed significantly over the past two decades. The time of nuclear missile confrontation of the Cold War with the Arctic playing a dominant part has past," Vasilyev said at a conference 'The Arctic: Region of Development and Cooperation' that opened in Moscow on Monday.
*** About 500 protesters block Ukrainian govt building
About 500 people are holding a rally near the building of the Ukrainian Cabinet of Ministers and are blocking all entrances demanding the resignation of the current government.
The rally is held peacefully, people are chanting slogans, activists block all entrances and exits to the building and two tents have been set near the Cabinet of Ministers building, an Interfax correspondent reported.
Activists have blocked traffic at Institutskaya, Grushevsky and Sadovaya Streets.
*** Ukraine Parliament building encircled by Berkut riot police
Units of law enforcement agencies have surrounded the Ukrainian Parliament headquarters after demonstrators protesting against the government's decision to suspend the signing of the Association Agreement with the European Union gathered outside the building on Tuesday morning.
The Verkhovna Rada building is currently encircled by several lines of Berkut riot police soldiers, an Interfax correspondent reported.
The protesters sang Ukraine's national anthem and chanted "the police are with the people", after which activists and opposition members addressed the rally.
*** DEPUTY PM: UKRAINE NEEDS 10-BLN-EURO LOAN TO MAKE EU PACT WORK
Ukraine needs a loan of about 10 billion euros to have a viable association agreement with the European Union, Ukrainian First Deputy Prime Minister Serhiy Arbuzov said in a television program aired on Sunday.
Ukraine has reached an agreement with the EU to jointly hammer out a roadmap for addressing risks an association pact would mean to the country, Arbuzov told ICTV.
*** OSCE observers arrive in Turkmenistan
The delegation of international observers from the Organization for Security and Cooperation in Europe (OSCE), who will monitor the preparations for and holding of elections to the Turkmen Majlis (parliament) scheduled on December 15, has arrived in Ashgabat.
The mission, sent by the OSCE Office for Democratic Institutions and Human Rights (ODIHR) upon the invitations of Turkmenistan, is headed by Ambassador Alexander Kelchevsky (France).
*** RUSSIA WILL REMAIN UZBEKISTAN'S STRATEGIC PARTNER, ALLY - KARIMOV
Russian Prime Minister Dmitry Medvedev believes there is a need for regular consultations between Russia and its allies such as Uzbekistan.
Medvedev made that statement at a meeting with Uzbek President Islom Karimov after the session of the Council of the Heads of Governments of the Countries of the Shanghai Cooperation Organization (SCO).
Ak ar of
Gazprom to work out South Stream route to Austria along with Italian route (Part 2)
OSCE demands release of U.S. journalist in eastern Ukraine
EU, Ukraine, Russia, Slovakia may hold gas talks on Apr 24 - Ukrainian energy minister (Part 2)
Donbas self-defense forces deny detention of U.S. reporter
Man found dead in river in Donetsk region identified as local lawmaker Rybak - Ukrainian Interior Ministry
U.S. directs actions of Kyiv authorities - Lavrov
EU, Ukraine, Russia, Slovakia may hold gas talks on Apr 24 - Ukrainian energy minister
Russia sends humanitarian aid to Syria, gets 20 tonnes of oranges as reciprocation gift
U.S. Department of State delegation to assess political plurality in Georgia