Belarus Will Pay More for Gas Next Year
Belarus will pay over $200 per 1000 cu. m. of natural gas in 2009, Vasily Khrol, Deputy State Secretary of the Union of Russia and Belarus announced yesterday. Gazprom has confirmed that information. The Russian monopoly demanded that much in 2006, but Belarusian President Alexander Lukashenko managed to hold the price down to $100 by selling Gazprom half of Beltransgaz for $2.5 billion. State Secretary of the Union State Pavel Borodin said that Belarus may avoid the high price this time by forming a confederation with Russia. The Russian Federation Council thinks Belarus could receive a price break in exchange for the placement of nuclear arms on its territory.
Belarus pays 67 percent of the price Poland pays for natural gas (minus transit fees and export duties) this year under the formula worked out by Gazprom and Beltransgaz in January of last year. In 2009, Minsk is to pay 80 percent of Warsaw's price. Gazprom sources say that, in spite of continual efforts by the Belarusians to negotiate a price freeze, that country will pay more for its gas next year. Poland is paying $310-320 per 1000 cu. m. of gas this year.
A political solution may found to suit both sides. Borodin noted that a confederation, for which he held up the European Union as an example, would allow common border and customs procedures and pricing policy. Belarus is experiencing increasing economic pressure from the West, and Lukashenko has made it clear that he is willing to be cooperative in economic issues in exchange for political support. During a visit to Minsk last week, Russian Prime Minister Viktor Zubkov expressed Gazprom's desire to be freed from a fee imposed by the Belarusian Ministry of Fuel and Energy's innovative fund.
Nothing that appropriating the remaining 50% of Beltransgaz won't solve.Russian senators note that a confederation of the two states would allow the placement of Russian nuclear arms in Belarus in response to U.S. plans to install missile defense facilities in Poland. Minsk has not commented on that possibility. In the middle of the 1990s, Belarus declared itself a nuclear-free zone.
That should cause Vladimir Paranoid to rethink his plans.
Or help Lukashenko to better understand Putie's Good Neighbor Policy
Via Kommersant
Deal with Serbia gives Russia victory in 'pipeline war' with EU
Russia won the right Friday to direct a major supply route for natural gas through its ally Serbia to Europe, a deal that analysts described as a Kremlin victory in a "pipeline war" with the European Union.
The agreement, signed in the Kremlin before President Vladimir Putin and visiting Serbian leaders, increased Moscow's control over energy supplies to Europe and could undermine a rival EU project.
Strong Russian opposition to independence for the Serbian province of Kosovo was a key bargaining chip in the negotiations that resulted in Serbia joining the project, the South Stream natural gas pipeline. Belgrade also agreed to sell a majority stake in Serbia's state-owned oil monopoly, NIS, to the Russian natural gas giant, Gazprom, at a favorable price.
South Stream is a project worth a projected €10 billion, or $14.7 billion, organized jointly by Gazprom and the Italian energy giant ENI to carry Siberian gas to Europe via the Black Sea.
"Our close political relations were today converted into economic results," Putin's chosen successor, First Deputy Prime Minister Dmitry Medvedev, told reporters. "This is a great breakthrough."
[...]
The agreements signed Friday by Tadic and Prime Minister Vojislav Kostunica of Serbia, gave Gazprom a 51 percent stake in Serbia's NIS oil and natural gas company, for €400 million [US$593,259,318.44 ed.] and a pledge to invest €500 million more by 2012.
Some analysts described the price as well below market value, giving estimates of €1 billion to €2 billion [US$1,483,589,692.57 - US$2,966,249,293.59 ed.], although others said the NIS plant needed heavy reconstruction.
NIS dominates the Serbian market, with a monopoly on refining and a network of almost 500 gas stations. The NIS deal gives Gazprom its first refinery outside Russia.
Gazprom gets OMV stake
Gazprom will acquire a stake of 50 percent in OMV's natural gas hub in Austria, giving it greater access to the Continent's customers, under an agreement signed Friday, Bloomberg News reported.
The two will sell to Germany and Italy through the Baumgarten hub, located near a trunk pipeline from west Siberian natural gas fields.
Via The IHT
On January 17, 2008, The Streetwise Professor observed thatGazprom/Russia is/are playing smashmouth ball over Serbia’s national oil company. Don Miller and Don Medvedev have presented Serbia with an offer it can’t refuse: to sell Naftna industrija Srbije at a fraction of its true value–and one with an unbelievably short fuse, like, you know, Friday.
In exchange for control of SIJ’s hard assets and guarantees of a monopoly position in Serbia for some period (take that Serbian consumers, Gazprom doesn’t do competition), Gazprom Neft (Gazprom’s oil affiliate) is offering an amount that has been estimated to represent well less than one-half (and perhaps as little as one-quarter) of the Serbian company’s value. The tacit quid pro quo is that Russia will support Serbia on Kosovo–but, if Russian rhetoric is to be believed (yeah, I know) they would do that anyways.
To make the deal look a little less like an abject surrender, Gazprom has also dangled the prospect of giving Serbia a stake in a future gas venture. Word of advice, guys–DON’T BELIEVE IT, and DON’T TAKE IT. Gazprom is the master of what Bob Amsterdam calls “premature contractualization.” That is, announcing deals just in time to forestall projects that are adverse to Gazprom’s interest, and then fading the deal when the threatening competing projects are shelved in response to the Gazprom announcement. Gazprom will whisper sweet promises in anybody’s ear to get what they want, and then renege when it suits them. (Nigeria–you should take note of this, as Gazprom has been wooing you too.)
Gazprom’s stratagem is analogous to a common ploy in the software business. In the 80s and 90s “vaporware” was a commonly employed competitive strategy. A software company would announce a new, improved software product in order to forestall entry by a competitor. Once the potential entrant was scared away, the new software would just fade away into the mists, never to be seen. Gazprom is essentially following this playbook–constantly announcing vaporpipelines, vaporwells, vaporinvestments, vaporstorage, vapor-you-name-it whenever a threatening project is mooted.
So, what Gazprom is offering Serbia is: a pittance in cash plus a pig in a poke in exchange for hard assets right now. Given Gazprom’s record of delivering on its big talk, the Serbs would be well advised to take cash on the barrelhead and take the promises for what they are worth–a little more than nothing.
It would be fair to say that Serbia is the first new province in Putie's Soviet Union Lite. Let's see how long it takes before soon-to-be Soviet Russian Premier Putin directs the new pawns - with their new military advisors - to square off against KFOR, while at the same time, telling the EU that abandoning their NATO obligations would be in their absolute best energy supply interests.
And whether he delivers the message or has his beard, Gazprom poohbah Gerhard Schroeder, do so instead.
See also: How To Attract Foreign Investment (Gazprom and its business partners)
Putin, the Kremlin power struggle and the $40bn fortune
An unprecedented battle is taking place inside the Kremlin in advance of Vladimir Putin's departure from office, the Guardian has learned, with claims that the president presides over a secret multibillion-dollar fortune.
Rival clans inside the Kremlin are embroiled in a struggle for the control of assets as Putin prepares to transfer power to his hand-picked successor, Dmitry Medvedev, in May, well-placed political observers and other sources have revealed.
At stake are billions of dollars in assets belonging to Russian state-run corporations. Additionally, details of Putin's own personal fortune, reportedly hidden in Switzerland and Liechtenstein, are being discussed for the first time.
The claims over the president's assets surfaced last month when the Russian political expert Stanislav Belkovsky gave an interview to the German newspaper Die Welt. They have since been repeated in the Washington Post and the Moscow Times, with speculation over the fortune appearing on the internet.
Citing sources inside the president's administration, Belkovsky claims that after eight years in power Putin has secretly accumulated more than $40bn (£20bn). The sum would make him Russia's - and Europe's - richest man.
In an interview with the Guardian, Belkovsky repeated his claims that Putin owns vast holdings in three Russian oil and gas companies, concealed behind a "non-transparent network of offshore trusts".
Putin "effectively" controls 37% of the shares of Surgutneftegaz, an oil exploration company and Russia's third biggest oil producer, worth $20bn, he says. He also owns 4.5% of Gazprom, and "at least 75%" of Gunvor, a mysterious Swiss-based oil trader, founded by Gennady Timchenko, a friend of the president's, Belkovsky alleges.
Asked how much Putin was worth, Belkovsky said: "At least $40bn. Maximum we cannot know. I suspect there are some businesses I know nothing about." He added: "It may be more. It may be much more.
"Putin's name doesn't appear on any shareholders' register, of course. There is a non-transparent scheme of successive ownership of offshore companies and funds. The final point is in Zug [in Switzerland] and Liechtenstein. Vladimir Putin should be the beneficiary owner."
Given the situation of Anna Politkovskaya, Luke Harding, Stanislav Belkovsky, Yulia Latynina and others had better develop a healthy sense of paranoia.
Read it all at The Guardian.
See also Why The Chekist Mindest Matters and Putin's Russia.
Also at A Tangled Web
H/T The JammieWearingFool
