Post-privatization (1996 to 2003)
The initial period of "oligarchic privatization" was characterized by ruthlessness and bloodshed, with those having power sometimes compared to 19th century robber barons, and Yukos was no exception.[28][29] For example, the former Security Chief of Yukos, Alexei Pichugin, was convicted on multiple counts of murder[30] and attempted murder, including (along with Yukos 1st Vice President Nevzlin) the murder of Vladimir Petukhov, mayor of the Yugansk oil province in Khanty-Mansi Autonomous Okrug and a vehement opponent of Yukos, on Khodorkovsky's birthday in 1998. Initially, Yukos, like most other Russian energy companies, was badly affected by the economic recession of the 1990s; subsequent to acquiring Yukos, accusations were made of other parties being squeezed out, and Yukos became formally owned by Rosprom, Menatep's holding company. In the late 1990s Russia was badly affected by a deepening of the economic crisis, in the course of which Bank Menatep became insolvent.
Yukos however recovered very quickly and, in the course of the next few years, became one of Russia's largest oil companies, one of the world's largest non-state oil companies, but more significantly, a leader in Russian corporate governance reform and corporate transparency,[32] with Khodorkovsky being widely seen as a pro-democratic reformer who advocated for international co-operation and against corruption in Russia.
In 2001 the company paid a $500m dividend, in 2002 – $700m and in 2003 the planned dividend payout was estimated at $3 billion. Its share prices were growing quickly: in 2001 by 191%, in 2001 by 81.5%. It started international expansion, purchasing 49% shares of Transpetrol (Slovakia) and 53% shares of Mazeikiu Nafta (Lithuania). In 2002 four companies – Yukos, Lukoil, TNK and Sibneft – established a consortium to build a pipeline from Western Siberia to Murmansk.[33]
In a marked change of direction which gained considerable United States coverage, the company and its owner came to be seen as a leopard that might be changing its spots and setting aside the dubious conduct previously associated with it in the early oligarch years. Yukos had five Americans on its board, and Khodorkovsky's charity "Open Russia" listed Henry Kissinger and Lord (Jacob) Rothschild as chairmen. In 2001 the company donated $1 million to the Library of Congress Open World Program, to aid the development of Russian leadership and rule of law, in part by funding Russian judges to visit and observe United States courts.[34]
In a 2002 profile, Forbes described Khodorkovsky as being "vilified by the West" until quite recently, but now being seen as perhaps "the West's best friend".[27] It stated that in Russia, "the financial free-for-all is yielding to an ethic of reinvesting in your business" with Khodorkovsky "leading the charge", with Yukos now having an American chief financial officer and publishing its previous three years of financial accounts in compliance with U.S. GAAP standards. It quoted Khodorkovsky as saying, "By now we understand how business is done in the West... I earn money in dividends and with the increase in the market capitalization of my company".[27] At the peak of its success, Yukos was producing 20% of Russian oil—about 2% of world production; in its final year before being broken up (2003–2004), Yukos pumped 1.7 million barrels of oil a day.[35] In April 2003, Yukos agreed to a merger/takeover with Sibneft, to create the fourth largest private company in the world, although this merger became undone in the aftermath of the October 2003 arrest of its CEO.
