ISSUES....
Inside,
confidential, off the record
A Russian
National Asset ?
What If Gazprom Becomes A Russian National Asset?
Gazprom
is the largest Russian company and the biggest extractor of natural
gas in the world.
With sales of US$ 31 billion in 2004, it accounts for about 93%
of Russian natural gas production and with reserves of 28,800 km3,
it controls 16% of the world's gas reserves. After acquisition
of the oil company Sibneft, Gazprom, with 119 billion barrels of
reserves, ranks behind only Saudi Arabia, with 263 billion barrels,
and Iran, with 133 billion barrels, as the world's biggest owner
of oil and oil equivalent in natural gas.
By the end of 2004 Gazprom was the sole gas supplier to at least
Bosnia-Herzegovina, Estonia, Finland, Macedonia, Latvia, Lithuania,
Moldova and Slovakia, and provided 97 percent of Bulgaria's gas,
89 percent of Hungary's, 86 percent of Poland's, nearly three-quarters
of the Czech Republic's, 67 percent of Turkey's, 65 percent of
Austria's, about 40 percent of Romania's, 36 percent of Germany's,
27 percent of Italy's, and 25 percent of France's. The European
Union gets about 25% of its gas supplies from this company.
On July 4,
2007 the Russian State Duma passed a bill giving Gazprom and
Transneft the authority to create their own security forces
with greater powers than other private security firms. Gennady
Gudkov, a deputy in the State Duma who opposed the bill, raised
concerns by calling it a “Pandora’s box... This law
envisages the creation of corporate armies. If we pass this law,
we will all become servants of Gazprom and Transneft.” If
Communist Party proposals for renationallization of certain assets
are realized, Gudkov’s concern may be part of a larger issue
as the newly formed security forces would have to be re-integrated
with existing Russian security forces.
In June 2007, TNK-BP, a subsidiary of BP Plc agreed to sell its
stake in Kovykta field in Siberia to Gazprom after the Russian
authorities questioned BP's right to export the gas to markets
outside Russia. On June 23, 2007, the governments of Russia and
Italy signed a memorandum of understanding to cooperate on a joint
venture between Gazprom and Eni SpA to construct a 558-mile (900
km) long gas pipeline to carry 1.05 Tcf (30 billion cubic meters)
of gas per year from Russia to Europe.
The South Stream
pipeline would extend under the Black Sea to Bulgaria with a
south fork extending to Italy and a north folk
to Hungary. Following the alleged violation of previous agreements
and the failure of negotiations, on August 1, 2007 Gazprom announced
that it would cut gas supplies to Belarus by 45% from August 3
over a $456 million debt. Talks are continuing and Belarus has
asked for more time to pay. Although the revived dispute is not
expected to hit supplies to Europe, the European Commission is
said to view the situation “very seriously.”
Posted
by Galina Ivanova / Russian Election 2008
Petroleumworld
10 08 07
ISSUES....
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