MOSCOW, April 22 (RIA Novosti) Top investigator fired for taking bribes/ Turkmenistan turns up heat on investors/ Naftogaz ousting Gazprom from Ukrainian market/ Oil companies' alarmist statements push oil prices up/ China ousting Russia from global aviation market
Vedomosti, RBC Daily
Top investigator fired for taking bribes
Dmitry Dovgy, head of the main investigative arm at the Investigation Committee of the Russian Prosecutor General's Office, has been fired after a probe into complaints against him was launched a month ago.
Vladimir Marking of the Investigation Committee said Dovgy was dismissed for failure to do his duty as stipulated in the law on prosecution and for disclosing confidential information in violation of the law on state secrets.
Some political analysts said Dovgy's actions endangered people close to the president.
The investigation against Dovgy began after Zigmund Lozhis and Sergei Chernyshev, the committee's investigators, submitted their complaints.
They claim that Dovgy took huge bribes, $1.5 million from a suspect in a criminal case involving the head of Russian company Petro-Union and 2 million euros in exchange for releasing former Trust Bank chairman Oleg Kolyda from custody in an embezzlement case involving Yukos subsidiary Tomskneft.
According to a law enforcement source, Dovgy is also blamed for telling the daily Izvestia that emigre businessman Boris Berezovsky was a suspect in the murder case of investigative journalist Anna Politkovskaya.
Dovgy was not charged because Alexander Bastyrkin, head of the Investigation Committee, reputedly wants to gloss over the problem as soon as possible, according to another law enforcement source.
Dovgy led inquiries against Deputy Finance Minister Sergei Storchak and General Alexander Bulbov, a former senior drug control official, both in jail on suspicion of embezzling $43 million in state funds. However, he was dismissed mainly because of numerous internal conflicts in the committee, a source in the Interior Ministry said.
Alexei Makarkin, deputy head of the Center of Political Technologies, supports the latter version.
"Relations between the Investigation Committee and the Prosecutor General's Office are very complicated, with competition growing when new agencies are set up and affecting personnel decisions," Makarkin said.
Stanislav Belkovsky, founder and president of the National Strategy Institute, said Dovgy was fired over the February attempt to take over major real estate assets in St. Petersburg controlled by people with close ties to Vladimir Putin.
"Dovgy made the attempt at his own risk, jointly with a St. Petersburg lawyer who was his personal acquaintance. The Kremlin interfered, telling Bastyrkin that Dovgy had lost his political bearings. It was decided to fire him," Belkovsky said.
Nezavisimaya Gazeta
Turkmenistan turns up heat on investors
Turkmenistan's authorities say the country has 21 billion tonnes of oil and 24.6 trillion cubic meters of gas reserves.
Analysts believe these exaggerated figures are quoted to kindle up artificial demand among foreign investors. In such circumstances, Ashgabat can raise gas prices for contracted buyers, including Russia.
Saparmurat Niyazov, the late former president, claimed that gas reserves were enough to export 150 billion cubic meters per annum for 250 years (comparable with recoverable reserves of 37 trillion cubic meters of gas from explored deposits). True, the figure was found to be exaggerated even by some high-ranking officials in Turkmenistan and has been put under the carpet.
Independent sources today estimate Turkmen gas reserves at between 8 trillion and 20 trillion cubic meters. According to the BP Statistical Review of World Energy, Turkmenistan's proven reserves total 2.9 trillion cubic meters.
Sobinbank analyst Mikhail Zanozin says the truth lies somewhere in-between.
"While BP gives conservative estimates, those of Turkmenistan are too optimistic," the analyst said. "Bloomberg's estimate of 19 trillion cubic meters looks more accurate," he said.
It seems that Turkmenistan is trying to create false demand for its resources, the analyst said. It launches many new projects and plans, which so far have drawn little investment. What is more, in recent years the country has struggled to provide sufficient gas to fill its export pipelines.
Two weeks ago, Iran agreed to buy Turkmen gas at prices above the contract level. Russia also agreed to prices being raised to world levels from next year, despite the contract in force. Now, judging by everything, it is time to put pressure on China.
"A 30 billion cubic meter gas pipeline to China is expected to go on stream by the end of the year, but some sources say Ashgabat could review its terms and conditions as well," Zanozin added.
"The earlier price of $90 clearly does not suit the Turkmen side. On the other hand, it could highlight difficulties of finding gas to fill the pipeline for China."
"The country will be unable to raise the output to the required level, and attracting investment is the only option," said Ivan Andriyevsky, managing partner of 2K Audit - Business Consulting.
RBC Daily
Naftogaz ousting Gazprom from Ukrainian market
Ukraine's national oil and gas company Naftogaz is forcing industrial companies that have contracts with UkrGazEnergo, Ukraine's gas importer 25% owned by Gazprom, to buy its gas and at a higher price.
It is pressuring them by limiting supplies. Analysts are convinced that Naftogaz is trying to snatch as big a share of the market as possible and strip Gazprom's subsidiary of consumers.
"We pay for the gas, but they threaten to cut supplies anyway. They demand that we sign contracts with Naftogaz," complained a source in Rovnoazot, a Ukrainian chemicals producer.
Naftogaz press spokesman Valentin Zemlyansky said gas supplies to industrial consumers had been cut because they did not have proper contracts.
"UkrGazEnergo does not operate on the Ukrainian market, Gazprom Sbyt Ukraina (another Gazprom subsidiary) has not yet begun operations, and Naftogaz has become the only gas supplier in Ukraine since April 1, according to the March 12 agreement. Therefore, they should sign contracts with us," he said.
UkrGazEnergo spokesman Vitaly Kisel said Naftogaz was selling gas at a price $34 higher per 1,000 cu m than his company. He also said that according to a Russian-Ukrainian agreement, UkrGazEnergo must continue operating until a Gazprom subsidiary is established on Ukraine's domestic market. Gazprom made no comment.
Naftogaz launched its campaign against UkrGazEnergo in mid-March. Gaz Ukrainy, which is a Naftogaz subsidiary, made an offer to the country's major industrial companies to buy natural gas from it. Otherwise, Naftogaz threatened to cut supplies.
Vadim Karasev, director of the Kiev-based Institute of Global Strategies, said Gazprom would not be able to change the contracts that were already signed, while Naftogaz was simply using the situation for its own benefit. Not all gas contracts have been signed in Ukraine and its relations with Gazprom are vague.
Therefore, the analyst concluded, when Gazprom Sbyt Ukraina finally enters the Ukrainian market, it will probably find no one to sign contracts with. By then, it won't find a reason to complain about official treatment in Ukraine because it would look like local consumers chose Naftogaz as their supplier of their own accord.
Vedomosti
Oil companies' alarmist statements push oil prices up
At a meeting of the marine board under the Russian government, Sergei Bogdanchikov, president of Russia's state-controlled oil major Rosneft, said Russia will need 61.6 trillion rubles ($2.62 trillion) in investment until 2050 in order to develop its shelf deposits.
This fantastically large sum strikes the imagination only at first glance. Actually, Bogdanchikov is moving in the same direction as Leonid Fedun, vice president of Russia's largest private oil producer LUKoil.
Last week, Leonid Fedun said that oil production in Russia had passed its peak and would not reach its former level.
Oil companies have long been complaining of exorbitant taxes which prevent them from investing enough funds in the exploration and development of new fields.
Proposing that over $2.56 trillion should be spent for this purpose by 2050, Rosneft does not specify the sources of funds (it promises to provide a quarter of the needed sum but analysts think it cannot afford to spend $15.5 billion a year on the shelf alone).
So the implication is clear: either the government will spend budget funds on exploration, actually returning part of the oil taxes to the companies, or it should grant tangible benefits to companies developing shelf deposits.
The difference between the rhetoric of state and independent oil producers is indicative: whereas independent oil producers state a reduction of investment in oil production (including for lack of guarantees of the ownership right), state companies propose long-term and expensive programs of investments in oil production calculated in a way which is difficult to understand.
However, this was to be expected after the decision was made that only state companies would develop the Russian shelf.
The alarmist statements made by oil and gas producers (which occur regularly and relate to both production and transportation problems) work objectively to escalate prices. Rosneft seems to be optimistic, but oil prices should rise even faster than now to help it implement its plans.
Nezavisimaya Gazeta
China ousting Russia from global aviation market
Beijing is using Russian technology to boost arms exports on a global scale, while Moscow's efforts to control the Chinese arms market through technology transfers have proved futile.
Under a 1996 contract, Beijing received Russian technology for assembling Sukhoi Su-27 Flanker fighters, but subsequently violated the document, mastered production of the Su-27's J-11 equivalents and started exporting them to Third World countries.
Moscow officially informed Beijing that it was violating bilateral agreements and said it would take legal action to protect Russian intellectual property.
Russian-Chinese military-technical cooperation has been facing problems in the last two years. According to international reports, China now receives 62% less Russian weapons, and no new contracts are being signed. Both sides are only fulfilling previous contracts worth $1.8 billion.
Beijing, a longtime major customer, is now exporting numerous weapons based on Russian models and know-how.
Moscow has turned China into a new rival on the global arms market. Beijing has long been selling pirated Kalashnikov assault rifle versions, as well as Grad and Smerch multiple-launch rocket systems, machine-guns, rocket launchers, self-propelled guns and tanks.
Substandard Chinese weaponry is much cheaper than original Russian versions.
Moscow is particularly irritated by the fact that the 1996 contract did not allow China to export J-11 fighters to third countries. However, Beijing is now promoting it and other weapons all over the world.
Chinese officials have announced plans to manufacture 5,000 J-11s and to sell most of them in the Third World.
The much cheaper J-11 can oust other similar military aircraft, including the Su-27, the Mikoyan-Gurevich MiG-29 Fulcrum and the Lockheed Martin F-16 Fighting Falcon.
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