News Markets Media

USA | Europe | Asia | World| Stocks | Commodities

Home News Europe The Main NPG Are in Hurry to Finish by 2008 the Privatization Process of Oil-and-Gas Assets


The Main NPG Are in Hurry to Finish by 2008 the Privatization Process of Oil-and-Gas Assets
added: 2007-01-02

In Russian economy the year 2006 has passed by being accompanied with amplification of the leading elite nomenclature-political groups (NPG) within the environment of an active President of the country - Vladimir Putin. This tendency has clearly mostly affected the basic domestic economical industry - the oil-and-gas one.

Companies, which are being controlled by the leading elite groups, have continued to play a role of key oil and gas market regulators, have taken away nearly all basic functions of executive and legislative authorities. Exactly they have determined the state policy towards Russian business and exactly they have established the operating procedure for foreign companies in Russian Federation.

At the same time the influence of ministries and departments at Russian market remained at low level - as before they had only the fixed instrumental functions, using which the policy of leading NPG and companies under their control is precisely executed. The State Duma of Russian Federation played the similar role.

The main NPG are in hurry to finish by 2008 the privatization process of oil-and-gas assets and redistribution of the Russian property according to own interests. Thus they are eager to minimize the risks before "contest of successors" is over. In 2007 the struggle in Putin's environment will become strained up to a limit. And in fact oil-and-gas industry development in an intermediate term does completely depends on who will win an election confrontation and what a configuration of political power after Putin leaves a presidential post will be.

Production results how industry works. Elite groups are anxious about "pumping" their own energy empires with the new assets. But, being practically undividedly supervising the oil-and-gas sector, they keep giving less attention to decision of essential problems of the industry. It is fraught with the beginning of a deep energy crisis in Russia, whose the first signs have already appeared. In particular, productive rates in "Rosneft" and "Gazprom neft" are noticed to have reduced, the production decline rates for natural gas at the main "Gazprom" fields keep growing. The prospects of changing an energy balance in Russian Federation, the reasons for searching gas alternative at domestic market and realness of long-term forecasts devoted to hydrocarbons production capacity in Russian Federation are estimated.

Strengthening of "Gazprom" monopolistic positions at gas market of Russia. The gas corporation of "liberals" de facto comes back to the frameworks of separate ministry which pretends to control and regulate the whole gas industry in the country, and also plans in future to add an oil sector to the own structure.

Formation of "silovoj" oil-and-gas industry. The "Siloviki" strive for completely submission of Russian oil market to them. Already today they have being controlling the basic trade flows not only of "Rosneft", but also of both "LUKOIL" and "Surgutneftegaz". However that is not sufficient for them - they want to receive the shares of the mentioned companies for their complete disposal. And, besides that, to include another oil shares, in particular "Tatneft" and "Bashneft", in own energy empire structure.

Tax and customs innovations in the industry. If earlier the executive power supported growth taxes in oil-and-gas industry as the instrument of economic diversification, then now the new owners of assets in the oil-and-gas complex successfully strive for provision of fiscal and customs preferences for themselves.

New energy policy of Putin. The year 2006 has brought many innovations for foreign politics of Russia. Promotion of interests of oil-and-gas corporations at foreign markets have become its main tasks. The principal purposes are - purchase of assets in a Downstream segment in Europe and China, and also the building of the new pipelines. There are two problems: hydrocarbons production capacity does not allow to realize the Western and Eastern expansion strategy simultaneously. Besides that, consumers have also begun a game against Russia hoping to gain for themselves the best conditions for power resources delivery.

The foreign capital: between two fires. The choice of foreign companies, which do want to work on Russian oil-and-gas market, is not significant. Only two ways of their existence in Russia have remained for them - to enter an alliance with the "liberals" or "siloviki" and total adoption of the rules based on which these NPG are willing to play both on Russian and foreign energy market.


Source: Business Wire

Privacy policy . Copyright . Contact .