MOSCOW, September 24 (RIA Novosti) More Russians opt for United Russia / Russia set to build four more nuclear reactors in China / Why is the West wary of buyers from the East? / Russian company to produce fertilizers in Venezuela / Sukhoi Log gold deposit reserves double after reassessment
Izvestia
More Russians opt for United Russia
The results of a recent electoral preferences survey by pollster VTsIOM shocked right-wing Russian parties.
The majority of the 13% of respondents who said they would vote for democratic parties in the December parliamentary elections (another 27% are not sure of their choice yet) opted for United Russia. This increases the group of democratic respondents ready to vote for the pro-Kremlin party to 70%.
Only 9% plan to vote for the Union of Right Forces (SPS), 7% for Yabloko, 3% for Civil Force, and 2% for the Democratic Party of Russia.
The head of VTsIOM, Valery Fyodorov, said proponents of democratic values had changed their allegiance because democratic values are now associated in Russia with a high standard of living and a belief that a civil society cannot survive without it.
"Voters think Untied Russia is doing the most toward this goal," Fyodorov said.
Vyacheslav Nikonov, president of the Polity Foundation, said: "Nobody likes losers. The people believe that United Russia is the only party capable of solving their problems, influencing the situation, and protecting their values."
The People for Democracy and Justice, a new party formed by former Prime Minister Mikhail Kasyanov, held its congress on Saturday.
On Sunday, other prominent members of The Other Russia opposition coalition met in St. Petersburg to nominate chess grandmaster Garry Kasparov, leader of the United Civic Front, as their common candidate for the presidency.
These events showed that the leaders of the radical opposition are unable to agree with each other, let alone with other parties.
Dmitry Orlov, director general of the Russian Agency of Political and Economic Communications, said: "The idea of a preliminary presidential voting in The Other Russia was proposed after Kasparov's supporters refused to support Kasyanov. As a result, the organization split into three groups that had initially formed it -supporters of Kasyanov, Kasparov and Eduard Limonov, head of National Bolsheviks."
The expert believes that this has killed off The Other Russia's chances for "a serious representation in the political process."
Gazeta
Russia set to build four more nuclear reactors in China
Moscow and Beijing are completing talks on building the third and fourth reactors at China's Tianwan nuclear power plant on the Yellow Sea coast. Russia believes that up to six reactors can be sited there, and some Chinese officials said they were ready to award the contracts to Moscow.
On September 12, Atomstroyexport, Russia's nuclear power equipment and service export monopoly, officially commissioned the second reactor, thereby completing the second stage of the Tianwan nuclear power plant.
The first reactor that was commissioned early this summer has generated over 6 billion kWh of electricity to date. Both reactors have now attained design capacity.
Russia has good chances of building additional reactors in Tianwan because standard power units are both cheaper and more convenient. However, Atomstroyexport is facing tough competition from Westinghouse Electric Company of the United States and French nuclear giant AREVA.
In late 2006, the U.S. company won a $5.3 billion tender to build two nuclear reactors in Zhejiang Province and two more in Guangdong Province. Atomstroyexport was forced to cancel its bid because China demanded technology transfers.
It appears that there will be enough room for all contenders on the Chinese nuclear power market, because Beijing plans to build up to 100 reactors until 2030 and to increase the share of electricity generated by nuclear power plants from 1.7% to 4% by 2020.
Experts said it would take the Tianwan nuclear power plant 20 years to recoup expenses.
Tianwan, the largest national nuclear power plant, is also the largest Russian-Chinese cooperation project. It costs about 2 billion euros to build a 1-gigawatt VVER-1000 water-cooled and water-moderated reactor there. Moreover, it is the safest plant in the world, and features a unique Russian molten-core catcher as a safeguard against accidents.
Experts said the probability of an accident at the Tianwan plant was 10-7.
Vedomosti
Why is the West wary of buyers from the East?
Borse Dubai, a Dubai-based exchange holding and the Qatar Investment Agency (QIA) have acquired a 48% stake in the London Stock Exchange (LSE) and 19.9% (5% of voting shares) in NASDAQ. The acquisition aroused concerns in the United States, and President George Bush vowed to personally check that the deals would not affect the country's security. Could this really be a time bomb for the West?
Yevgeny Gavrilenkov, chief economist with Troika Dialog, a major Russian brokerage, said a situation where Arab, Chinese, Russian, and Japanese buyers targeted major Western assets had naturally followed from the industrial nations' recent macroeconomic policies, including liberal budgetary and monetary policies and stimulation of demand. Who can satisfy this demand? The developing countries, naturally. So what should they do with this money?
To put it in simpler terms, such acquisitions support their domestic currencies. Without a stream of incoming capital, they would have no choice but to depreciate the currency, the expert explained.
Gavrilenkov said he did not share the developed countries' concerns over foreigners acquiring their assets. As the globalization game has been started, it should be played through to the end. Although it is clear that in the first stage of globalization those who initiated it have gained, their benefits now seem doubtful. Globalization increases competition and makes the economic system more effective, he said.
Anatoly Utkin, who heads the Center for International Studies of the Russian Academy of Sciences Institute of the United States and Canada, said the Arabs were assimilating Western culture like no other nations. Their mentality is changing, unlike for example that of the Chinese, who never show feelings of local patriotism.
On the other hand, Europe is faced with a problem of a gradual extinction of its population. So what needs to be done to uphold the $35,000 annual per capita income in Europe? Someone needs to work to ensure it. Germany is used to the Turks doing all the work, while France thinks it should be the Arabs. My opinion is that Europe has accepted its fate - moving closer to the Arab world - and is gradually opening to the East, the expert said. The United States is different. It is a growing nation with an annual population increase of 1.5 million a year. They are not happy with emergence of competitors.
Kommersant
Russian company to produce fertilizers in Venezuela
Evrokhim, a Russian producer of mineral fertilizers, wants to build a 1 million ton nitrogenous fertilizer plant in Venezuela. In view of the possible nationalization of the agrochemical sector and the special status enjoyed by Russian companies in that country, the project could afford Evrokhim access to new resources.
Evrokhim is Russia's largest producer of mineral fertilizers with 6 million metric tons a year. Its revenues in 2006 totaled $1.964 billion, and net profits, $257 million.
"Evrokhim needs to show that it has good growth prospects, perhaps with an eye to its future sale," said Marina Alekseyenkova, an analyst with Renaissance Capital. In her opinion, an operation in Venezuela could benefit the company by giving it new duty-free outlets.
Earlier, the company said if it went ahead with an IPO, it would finance the development of the Gremyachinsky deposit of potash salts (Volgograd Region) starting in 2012. The company requires $1 billion to do the job. Georgy Ivanin, an analyst with Antanta Capital, estimates the Venezuelan project at $500 million if started from scratch and at $200 million if existing capacities are expanded.
The main producer of fertilizers in the country is the state-owned company Petroquimica de Venezuela, which has ambitious plans. It has stated more than once that it wants to become the world's largest producer of mineral fertilizers.
The largest fertilizer complex in Venezuela, FertiNitro, is located in the town of Jose. Pequiven has a 34.99% stake in the project being implemented in a consortium with foreign developers. Currently, the company is looking for a partner to build a FertiNitro-II plant.
But cooperation with Western partners might be plagued by the potential nationalization of Venezuela's agrochemical industry, as was the case in the petroleum sector. In March, the country's legislature adopted a law forcing nitrogenous fertilizer producers to switch from exports to domestic consumption and sell their products at reasonable prices.
In the view of the Fitch rating agency, the basic agreements on FertiNitro may be revised, and the foreign companies that, when establishing the consortium, obliged Pequiven to export 50% of the output at market prices might lose a large chunk of their stake in the project. Russian companies, on the other hand, enjoy major preferential terms in Venezuela, and Evrokhim might even be able to join FertiNitro.
Business & Financial Markets
Sukhoi Log gold deposit reserves double after reassessment
Eurasia's largest gold deposit, Sukhoi Log (Dry Gulch), contains 1,920 metric tons of gold with 2.8 g/t of gold in ore. This figure doubles the previous estimate of the deposit's reserves. The reassessment of Sukhoi Log was undertaken as part of the process of putting it up for auction in 2008, say experts. The deposit will be sold for no less than $200 million.
According to Rosnedra, Russia's subsoil agency, the estimated capacity of the mining enterprise in the vicinity of Bodaibo, in the Irkutsk Region, will be 12 million metric tons a year from now and annual output will be 30-50 metric tons. Exploration investment will total $1.6 billion, and operating costs will be $0.35 billion a year. The enterprise will be constructed within four to five years, and the payback period will be six to nine years. The total profit from the enterprise for the entire duration of its operation is forecast to be $30 billion, and the state's income will be $2.5 billion.
Taking into consideration this new data, the start-up license cost is expected to be more than $200 billion, says Vladimir Popov, an analyst at Antanta Capital. Sukhoi Log was supposed to be auctioned in 1998, but the sale was postponed. The reassessment indicates that the auction will take place in the near future. Sergei Donskoi, an analyst at Troika Dialog, says that the deposit will be sold in 2008.
Gold producers such as Polyus Gold, Polymetal and Alrosa are planning to take part in the tender. Polyus Gold is the most likely winner, say many experts. The company's staff also believes it has the best chances. In any case, Polyus itself selected and analyzed technological samples from the deposit and found ways to cut costs of gold mining at Sukhoi Log using new technologies.
But not everybody agrees. Sergei Donskoi thinks that the main contenders are Alrosa and Polymetal. "Polyus Gold has enough assets like this; that's why they are not likely to bid for it," he said.
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