Commodity trader Glencore has agreed to sell its stake in the Russian oil company Russneft, to an undisclosed buyer, reported Reuters.

Glencore CEO Gary Nagle was cited by the news agency as saying that the sale comes as the commodity trader considers Russneft as ‘no longer material to its business’.

The firm has been looking to offload its stake since the re-organisation of Russneft’s top management.

An undisclosed source with Glencore, involved in the Russian oil market, was quoted by Reuters as saying: “Glencore chooses the right time to exit Russneft as oil prices are good, while the asset is quite risky.”

The deal was signed in December 2021, with completion planned for the first half of 2022. The transaction is subject to regulatory approvals. The financial terms of the deal were undisclosed.

Kommersant daily cited sources saying that Glencore’s stake in the Russian oil firm will be sold to Russneft’s former owner and founder, Mikhail Gutseriyev. The stake could be valued nearly $146m (RUR11bn).

Last year, RussNeft set a target to produce 6.78 million tonnes of oil in 2022. It also plans to make capital investments of RUR22.7bn, most of which will involve drilling.

The firm, which has a production capacity of approximately 130,000 barrels per day, aims to build 100 new wells to increase oil production by 635,000 tonnes this year.

Employing nearly 8,000 staff, Russneft owns a portfolio of assets located in the key Russian oil and gas provinces including West Siberia, Volga-Urals, and Central Siberia, as well as in Azerbaijan.

Earlier this month, Maire Tecnimont signed a contract to construct a vacuum gasoil hydrocracking complex at the Ryazan Refining Company production site, in Russia.