Gazprom's probable acquisition of Sibneft, Russia's fifth-largest oil company, for about $10 billion, will bring to an end large-scale M&A activity in the country's oil and gas industry.
Domestic and foreign oil majors will instead be forced to concentrate on smaller Russian assets or look farther afield in former Soviet states in the CIS if they want to continue their growth through acquisition.
Lukoil kicked off serious consolidation in the industry in 1999 through its Komitek purchase. TNK and Sibneft's joint acquisition of Slavneft followed in 2003, as did the merger between BP and TNK. And at the end of last year Rosneft shocked the market with its successful bid for Yuganskneftegas, Yukos's main asset.
The remainder of Yukos's assets will offer some of the choicest Russian targets, alongside two internationally listed smaller oil producers, Sibir Energy and West Siberian Resources.
In CIS states, Caspian operators such as Petrokazakhstan, Dragon Oil and Nelson Resources will probably be up for grabs, albeit at ever-higher multiples.
"As we witness the final round of consolidation we will see the smaller assets being sold at increasingly higher prices," says Steven Dashevsky, head of research at Aton Capital in Moscow.