MOSCOW, Dec 2: Battered Yukos was hit again on Tuesday with accusations of avoiding a five-billion-dollar tax bill — perhaps the most damaging allegation to turn up against the Russian oil company that won Western hearts for its commitment to transparency.

But even as its name was dragged deeper through the mud and its former chief executive Mikhail Khodorkovsky languished in jail, the company struggled on to survive.

Company officials said that talks were underway in London to complete a merger with its smaller sibling Sibneft that would create the world’s fourth-largest energy concern.

There were contradictory reports as to whether Yukos was ready to accept Kremlin-linked Sibneft managers as the new company’s directors.

But its more immediate concern on Tuesday was a letter from the tax ministry reportedly sent to the prosecutor’s office as part of the broader Yukos inquiry.

The letter, obtained by Interfax and whose portions were read to AFP by telephone, said that Yukos and a group of “problem banks” linked to the company failed to pay 150 billion rubles ($5bn) in taxes, fines, and related penalties over the past six years.

Interfax said this tax ministry letter had been sent to the same Russian prosecutor’s office that has been leading an investigation into Yukos management over the past six months.

A Yukos spokesman contacted in Moscow said “the company will not comment on any rumours reported by news agencies.”

This was not the only front on which Yukos was having its latest troubles Tuesday.

The company is struggling within itself to decide how to forge an alliance with Sibneft that fell apart on Friday — according to both Yukos and some analysts — under Kremlin pressure.—AFP