OPIC is a U.S. government agency that helps U.S. businesses invest overseas, fosters economic development in new and emerging markets,

complements the private sector in managing risks associated with foreign direct investment, and supports U.S. foreign policy. Because

OPIC charges market-based fees for its products, it operates on a self-sustaining basis at no net cost to taxpayers. Since 1971, OPIC has

supported over $150 billion worth of investments that have generated over $66 billion in U.S. exports and supported more than 257,000

American jobs. For information or to subscribe to OPIC News, please visit our Web site at: http://www.opic.gov.

Supporting Private Sector Investment in Russia

Since 1992, OPIC has provided more than $3.8 billion in finance and insurance to 115 projects ranging from

manufacturing to telecommunications. OPIC’s current finance and insurance investments provide more than

$397 million to 17 projects in the manufacturing, financial services and energy sectors. OPIC’s investment funds

have committed over $900 million to seven funds, and currently have five funds with $224 million invested in 20

companies in Russia.

March 2004

OPIC Highlights

Office of External Affairs

1100 New York Avenue, NW

Washington, DC 20527

202-336-8400

www.opic.gov

OVERSEAS PRIVATE INVESTMENT CORPORATION

OPIC Insures U.S. Small

Business for Expansion

in Russia 

International Scientific Products

Corporation (ISP) of New York

will use $777,000 in OPIC’s political risk insurance to expand its

optical components manufacturing

facility in Russia.

The insurance will cover against

risk of expropriation and political

violence for a consignment of

equipment and accessories to be

used to increase production and

quality control at ISP’s operation

in St. Petersburg.

The Russian enterprise, ISP Optics

Sankt Petersburg, produces optical

components such as lenses, domes,

prisms, polarizers and wave plates

that are sold to markets in the U.S.

and worldwide.

OPIC expects this project to generate 20 local jobs as well as tax

revenue for the country.

ISP has also ensured that senior

management of the enterprise will

receive MBA coursework and that

its opticians will receive professional training in the United States.

OPIC Signs Financing

Agreement for Oil Export

Project in Russia

In September 2003, Ross J.

Connelly, OPIC executive vice

president and chief operating officer signed an agreement with

Russia’s leading oil producer

committing OPIC to guarantee

$130 million in financing for a

project that will enable Russia to

expand its oil export capacity in a

cost-effective manner.

OPIC is providing the loan guaranty to a subsidiary of HBK Fund

LP, a Delaware limited partnership based in Dallas, Texas, for a

$225 million loan it will make to

an indirect subsidiary of OAO

Lukoil, Russia’s leading oil producer.

The project consists of the construction and operation of a crude

oil and petroleum products export

terminal on the western coast of

Vysotsky Island on the Gulf of

Finland, north of St. Petersburg.

OPIC-guaranteed financing will

specifically cover the first two

phases of the project, including

construction of rail links and

upgrades, two tank farms and a

marine jetty, as well as dredging

in the Gulf of Finland to allow for

the passage of crude and product

tankers. The project is being constructed by a consortium consisting of Lukoil Neftegastroi and a

subsidiary of a U.S. engineering

firm.

Connelly said, “Insufficient transportation and storage capacity for

exportable oil products has been a

significant problem for Russian

producers such as OAO Lukoil.

With the support of a U.S. company, this project will enable OAO

Lukoil both to expand its export

volume and substantially reduce

its average transportation costs.”

OPIC Executive Vice President and Chief

Operating Officer Ross J. Connelly, right,

and Lukoil Chairman Vagit Alekperov sign

agreement for OPIC-guaranteed financing of

oil export project in Russia. Standing in

front of American flag is U.S. Secretary of

Commerce Donald Evans.
Small Business to Use

OPIC Insurance to

Employ Russian Nuclear

Scientists for Medical

Advances 

In a unique project facilitating

U.S. Department of Energy

(DOE) efforts to reduce nuclear

proliferation, OPIC has committed to provide up to $25 million

in insurance to Numotech, Inc. of

Northridge, CA, a U.S. small

business, to attract equity financing to establish a Russian joint

venture which will employ former

Russian nuclear scientists to manufacture medical equipment such

as prosthetics and state-of-the-art

burn treatments.

“Finding productive employment

for nuclear scientists has been a

vexing challenge since the end of

the Cold War. Working with our

colleagues at the Department of

Energy, we at OPIC are pleased to

be able to help turn those

advanced scientific skills to the

manufacture of cutting-edge, lifesaving medical equipment of the

kind produced by Numotech,”

said OPIC President and CEO Dr.

Peter Watson.

OPIC Loan Helps Micro

and Small Banking

Customers 

OPIC has committed to provide a

$30 million loan to Russia’s leading micro- and small finance bank,

Small Business Credit Bank

(KMB Bank), enabling KMB

Bank to make small loans to

micro, small and medium-sized

customers investing in Russia.

Sponsored by the Soros Economic

Development Fund (SEDF), the

OPIC loan will be used for short

and medium-term financing of

projects involving investment in

industrial and production facilities

OPIC Board Approves

$150 Million Lending

Facility for Russia and

Central Asia 

The OPIC board of directors in

September 2003, approved a $150

million guaranty to support

Citibank’s U.S. dollar and local

currency projects in Russia,

Azerbaijan, Kazakhstan, Ukraine

and Uzbekistan.

The guaranty is designed to help

Citibank expand availability of

for its micro and small-sized

customers. KMB Bank will also

offer working capital financing

as well as financing of production equipment.

In addition, KMB management

will provide intensive on-the-job

training for loan officers, as well

as formal training seminars and

workshops.

“In addition to its direct benefits, this project will stimulate

the local economy by providing

credit to small businesses and

entrepreneurs,” OPIC President

and CEO Dr. Peter Watson said.

“We are pleased to work on a

project which will enable micro

and small banking customers to

play an important role in the

development of Russia’s economic infrastructure.”

OPIC is a U.S. government agency

that helps U.S. businesses invest

overseas, fosters economic development in new and emerging markets, complements the private sector in managing risks

associated with foreign direct investment, and

supports U.S. foreign policy.

Because OPIC charges market-based fees

for its products, it operates on a self-sustaining

basis at no net cost to taxpayers. Since 1971,

OPIC has supported over $150 billion worth of

investments that have generated over $66 billion in U.S. exports and supported more than

257,000 American jobs.

credit in the region. Citibank and

OPIC will share the risk for individual loans originated under this

facility, each of which will be

cleared by OPIC for U.S. effects,

environmental, human and workers’ rights. 

OPIC President and CEO Dr.

Peter Watson said the OPIC facility would enable Citibank to

expand its presence in these

countries, by helping to close the

gap between loan opportunities

and the limited amount of financing available in Russia and

Central Asia.