MOSCOW, September 4 (RIA Novosti)
Russia can also settle conflicts peacefully / Ukrainian crisis to teach Russia and the West to compromise / Gazprom making Europe's nightmares real / TNK-BP shareholders ready to shake hands / Gaz de France to share Caspian risks with LUKoil / Rosneft stalls on unveiling one of largest East Siberian fields /
Nezavisimaya Gazeta, Kommersant, Vedomosti
Russia can also settle conflicts peacefully
Igor Smirnov, the leader of the breakaway republic of Transdnestr, yesterday created a sensation by saying he was ready to negotiate a settlement with Moldova.
Smirnov's stance changed dramatically after his meeting with Russian President Dmitry Medvedev, who "used all the arguments at his disposal" to convince him to do this, say sources with close ties in the Kremlin.
Moldova and Transdnestr, which suspended settlement talks two years ago, received the news with cautious optimism but expressed little enthusiasm for a Russian proposal to return to the 2003 Kozak Memorandum.
The memorandum provides for forming a confederation where Transdnestr would have the right to self-determination if Moldova loses its sovereignty by becoming incorporated into Romania. It also stipulates a Russian military presence in Moldova.
The document could possibly be reviewed.
Igor Botan, a Chisinau-based political analyst, said: "Moldova will never accept Transdnestr's right of veto and the presence of 2,000 Russian servicemen on its territory."
Sergei Cheban, head of the Committee for Foreign Policy and International Relations at the Transdnestr parliament, said the Kozak plan was unacceptable to Transdnestr as well.
Transdnestr leader Smirnov told the daily paper Nezavisimaya Gazeta he was ready to sign the memorandum in 2003 "though it was a difficult decision." He has now made another difficult decision before agreeing to talk with Moldova.
"Smirnov has made many sharp statements, and we had to use all of the available arguments to encourage him to view the problem constructively," a source in the Kremlin told the business daily Kommersant. "We eventually convinced him that he has limited room for maneuver."
The Kremlin reminded Smirnov about his republic's $1.5 billion gas debt and machinations with Russian humanitarian relief.
At the same time, the Transdnestr leader was also promised lavish compensation for his difficult decision. Russian education and healthcare programs will be expanded to involve the breakaway republic, and the Russian authorities pledged to use Russian funds to make direct payments of pensions to some 100,000 Russian passport holders in Transdnestr.
Moscow is not going to address the problem of Transdnestr single-handed.
After Moldovan President Vladimir Voronin meets with Transdnestr leader Igor Smirnov in the presence of Medvedev, the talks are to resume in the 5 + 2 format, which has been suspended for the past two years.
It involves Russia, Ukraine, the OSCE, Moldova and Transdnestr plus the U.S. and the EU, which means that the West will take part in the settlement even though it will be supervised by Russia.
Vedomosti
Ukrainian crisis to teach Russia and the West to compromise
The current political crisis in Ukraine is seen by many in the context of Russia's escalating conflict with the West. Incidentally, both Russia and the West could try and draw useful conclusions from what's going on in Kiev.
One of the apparent main reasons for the Ukrainian crisis was the insurmountable difference of opinion in the evaluation of the Russian-Georgian conflict. However, the true underlying reason is the three conflicting parties' inability to find a compromise and stick to it long enough.
The crisis also exposed each party's clear foreign-political stand. President Viktor Yushchenko is clearly attracted to NATO, Prime Minister Yulia Tymoshenko is very friendly with the European Union, while Viktor Yanukovych, leader of the Regions Party, advocates closer ties with Russia.
With presidential elections slated for 2010, and early parliamentary elections possible in 2009 if the current Rada is dissolved, Ukraine will naturally become a new site for fighting over influence in the former Soviet republics.
Luckily for Ukraine, both external heavyweights, Russia and the United States earlier made unsuccessful attempts to pressure Ukraine. Vladimir Putin's blunt canvassing once ruined Yanukovych's presidential campaign, while a visit by George Bush accompanied by snipers gave a boost to anti-American sentiments in Ukraine. Moreover, a conflict in Ukraine would be greater than the Georgian one, and would have much more disastrous consequences. One can only hope that they will learn some lessons from the recent five-day war, which could have been prevented but wasn't.
Ukraine's political forces are arranged in such a way that the three conflicting parties are virtually blocking each other. This isn't good for pursuing any consistent economic policy, but on the other hand it prevents either force from any rapid action.
The three key players in the international political crisis, the U.S., EU and Russia, should learn a useful lesson here. Given the uncertain number of political powers bases in the modern world order, the three active parties to the conflict should sit down at a negotiating table, even though the process seems complex and hopeless right now.
Gazeta
Gazprom making Europe's nightmares real
Russia's gas monopoly signed a MoU with the Nigerian National Petroleum Corporation Wednesday, thus finally constricting Europe's windpipe.
Nigeria is one of the largest natural gas producers in Africa. The country's proven natural gas reserves are estimated at over 5 trillion cubic meters, according to BP estimates.
The EU used to cherish hopes that as new fields are developed there, Nigeria would channel its gas to Europe through the pipelines GALSI (Algeria-Sardinia-Italy) and Medgaz (Algeria-Spain). In 2015, these pipelines were also expected to be filled with gas coming through NIGAL, a pipeline from Nigeria to Algeria also known as the Trans-Sakhara project.
Gazprom, too, has been showing interest in the project. But the EU, which undertook to shoulder the full cost of the project, around $10 billion, earnestly planned to build the facility without Russia's help.
Gazprom first cast doubt on the practicability of that plan in the summer of 2006 by signing a strategic partnership agreement with Algerian Sonatrach. But Gazprom's memorandum with NNPCÀ was the last straw that convinced analysts that Trans-Sakhara cannot be built without the Russian monopoly's involvement.
It isn't so bad for Europe if Russia takes part in the NIGAL project, analysts say. What's worse is that Gazprom is trying to gain control over the key energy flows from Africa to Europe, said Vitaly Kryukov from the Kapital investment company. He said a joint venture with NNPCÀ was yet another step in that direction.
This rapprochement with Nigeria followed similar accords signed with Algeria and Libya, Africa's key oil and gas exporters.
Brussels still has time to find an alternative energy supplier. Analysts do not think Gazprom will make rapid progress in Nigeria. The bulk of tapped resources there are controlled by Western companies or their JV's with Nigerian partners. Neither is likely to sell their stakes to Gazprom unless they have strong reasons to do so. As for development of new fields, it is a long and costly process.
"Gazprom won't easily find a foothold in Nigeria today," said Svetlana Savchenko, head of investment planning at 2K Audit-Business Consultations. "Development of new fields will require substantial investment, and the current instability in the country implies high risks. In addition, Gazprom is currently investing in other large and costly projects including South Stream, Nord Stream, Shtokman and the eastern gas program," she added.
Vedomosti
TNK-BP shareholders ready to shake hands
The shareholders of Russian-British oil venture TNK-BP may today shake hands on the idea of an independent chief executive and an IPO, equally shared by each partner, of up to 20% of the company's shares, the daily paper Vedomosti writes.
BP and the AAR consortium of Alfa Group, Access Industries and Renova, are expected to announce in the next few days that they have signed the document on the settlement of their half-year conflict over strategy and management at the venture, which accounts for almost a quarter of BP's worldwide production and proved reserves.
TNK-BP is Russia's third-largest oil company.
Representatives of the Russian and British shareholders, led by Mikhail Fridman, the founder of Alfa Group, and BP CEO Tony Hayward, are to meet today, said two sources close to AAR and two TNK-BP managers. If all goes well, they will announce the signing of a memorandum of understanding, a source said.
The main condition of Russian shareholders is the resignation of TNK-BP CEO Robert Dudley by the end of the year. They claimed Dudley was running the company exclusively in the interests of BP.
A TNK-BP manager and an AAR consultant said the new chief executive should be an independent candidate suiting both sides.
The new chief executive, to start by early next year, will be presumably nominated by BP and approved by the board of TNK-BP, whose structure will change to end the current gridlock caused by having two sets of five members from each side. The new board will have 11 members, four from each side and three independents. The 14-person management committee will be more than halved.
The new CEO will have fewer powers than Dudley had. In particular, he will be unable to unilaterally form the boards of directors of key subsidiaries and vote with their shares (including the 95% stake in TNK-BP Holding, which comprises the company's Russian assets).
Another key element of the memorandum is the initial public offering, said a source close to AAR. A source in BP said the IPO could be held within two years, and that the decision on its timeframe and volume would be made by the majority of directors of TNK-BP Ltd., the group's head company.
Flotation is stipulated for the shares of a company one level below the holding company, said a source in AAR.
The stakes of AAR and BP in the head company must remain the same, 50:50, said an employee of one of the consortium's companies. A new company may be set up to hold all of the group's assets, he added.
As much as 5% of shares of TNK-BP Holding are currently floated on the market.
Denis Borisov, an analyst at the Solid investment financial company, said TNK-BP was undervalued by 40% compared with similar companies. Its capitalization on the RTS Board was $25.94 billion yesterday.
If the market overcomes the liquidity crisis, TNK-BP's value may double within two years after the 20% IPO, Borisov said.
The venture's Russian shareholders should be satisfied, as they have received almost everything, or at least everything they have claimed publicly, he said.
Vremya Novostei
Gaz de France to share Caspian risks with LUKoil
In the midst of the anti-Russian campaign in the West, Russia's largest private oil producer LUKoil has invited a foreign partner to participate in the project to develop the D-222 (Yalama) block in the Azerbaijani zone of the Caspian Sea. The first well drilled there in 2005 brought no results. The French oil major, Gaz de France, will participate in drilling the second well, which is to begin in November.
The value of the transaction for the sale of a 15% stake in the Yalama project (in which LUKoil holds 80% of the shares) to the French company is not known but experts think it may be from $35 million to $200 million. To complete the deal, the companies must wait for its approval by the other shareholder, State Oil Company of the Azerbaijan Republic (SOCAR), which holds a 20% stake in the project.
The contract signed in 1997 provides for the exploration period to end in 2011, with another 25 years given to develop the field and produce hydrocarbons there. The contract includes a provision under which it may be prolonged for five more years.
It has never been revealed how much the Russian company paid for an 80% stake, but the whole project was assessed at about $2 billion. LUKoil launched exploration drilling only in 2004, but the first operations, which cost it about $35 million, were far from successful considering that the field's reserves were estimated then at 800 million metric tons of oil and up to 50 billion cu m of gas. However, after the completion of exploration work in 2005, when 2D and 3D seismic surveys were conducted in the first of the two wells (which was drilled about 30 km off the coast from the Geidar Aliyev floating platform to the depth of 4,500 m, with the water layer of 332 m), LUKoil had to state that it had not found "any commercial hydrocarbons reserves." The company said it would start exploration drilling in the second well in November 2008.
Experts think the sale of a stake in the project shows that LUKoil is not eager to drill the second well on its own, as the results may prove discouraging again.
Meanwhile, Gaz de France, which tried to buy a stake in the Nabucco gas pipeline project, has long displayed interest in oil and gas projects in Azerbaijan. However, nearly all of them have already been divided.
RBC Daily
Rosneft stalls on unveiling one of largest East Siberian fields
State-owned oil giant Rosneft has pushed back the unveiling of its Vankor deposit till the middle of 2009. Most of its oil was planned to be shipped along the future Eastern Siberia-Pacific Ocean (ESPO) pipeline. Now experts fear the company might slip on this deadline, too.
The total reserves of the Vankor field (in Krasnoyarsk Territory) are 543 million metric tons (as of the end of 2007 and according to SPE standards); of them, proven reserves are 199.5 million metric tons, and probable reserves, 232.5 metric million.
Mikhail Stavsky, Rosneft vice president, explains the delay as due to more ambitious targets: a new technological scheme provides for a peak output of 23 million metric tons a year, instead of the planned 12 million metric tons. The new scheme also provides for increasing the production of petroleum gas to 4.6 billion cubic meters from 2012. If geological exploration produces encouraging results, one could speak of a new oil province, the company said.
Dmitry Lyutyagin, an analyst at the Veles Capital brokerage, said one of the reasons why the start of work on the Vankor deposit is being put off is the delay in launching the ESPO pipeline, which has been moved to the end of 2009. And this is not to mention the widening of the project, and, as a result, an increased period of preparations. Without the pipeline, Rosneft will find it hard to ship increasing quantities of oil from Vankor, the expert said.
Dmitry Dzyuba, an analyst with Zenit Bank, said such a major rescheduling is no doubt an unfavorable circumstance. The delay could point not only to Rosneft's technological snags, but also show that ESPO reverse deliveries suffer certain setbacks, the expert said.
But the company's new plans also sound an upbeat note, because Rosneft plans to hit the peak of production on Vankor in 2012, or five years ahead of the target date.
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