RIA Novosti reported that Mr Mikhail Fradkov PM of Russia has signed a resolution on merging the state controlled crude pipeline operator Transneft with the state run oil product transit company Transnefteprodukt.

As per report, under the resolution, the Russian government has contributed 100% of Transnefteprodukt's stock to Transneft's charter capital as payment for the pipeline monopoly's newly issued shares.

After the merger, which is expected to take five months, the government will hold at least 75% plus one share in the united company.

Russian analysts believe that the merger is likely to raise the companies’ efficiency and cut independent producers expenses on oil and petroleum product transportation.