MOSCOW, April 3 (RIA Novosti) – Russia’s antitrust watchdog has opened a probe into Russian energy giant Gazprom over alleged abuse of its monopoly position by signing pipe supply contracts with preferred contractors, Vedomosti business paper reported on Wednesday, citing Federal Anti-Monopoly Service (FAS) head Igor Artemyev.
Gazprom is suspected of signing a deal giving pipe trader North European Pipe Project, controlled by the Rotenberg brothers, an exclusive market position and restricting market competition, FAS department head Maxim Ovchinnikov told Vedomosti.
The FAS held an investigation in mid-March which revealed Gazprom tenders for the purchase of pipes excluded direct participation by pipe producers.
“The practice of the purchase of large-diameter pipes by Gazprom has actually eliminated the possibility of producers supplying their products directly, bypassing an intermediary, therefore restricting their possibility to actively compete among themselves,” the FAS press office said earlier.
The probe follows reports that state-run Gazprom has lost about a third of its market value over the past year, as rising expenditure, declining profit and the prospect of lower-than-expected dividends keep investors away, Bloomberg reported.
Gazprom is currently valued at less than $100 billion for the first time since 2009 over investor concerns about mismanagement at the gas monopoly, Bloomberg reported.
Gazprom's dominant position on the Russian gas market has often been the subject of criticism by potential competitors and customers. Earlier this year, President Vladimir Putin called for a "gradual end" to the company's monopoly on supply of liquid natural gas.