What the Russian papers say


MOSCOW, February 16 (RIA Novosti)
United States offers security deal to Russia / Moscow wins nuclear tender in Turkey / Exxon to curtail Sakhalin projects / Government set to reduce top bank managers' bonuses

Vremya Novostei

United States offers security deal to Russia

The new U.S. administration said it would reconsider its plans to deploy parts of its missile defense shield in Central Europe if Russia successfully dissuades Iran from making a nuclear bomb. U.S. concerns have been running high since Iran orbited a satellite a few days ago, proving it was capable of launching long-range missiles.
[U.S. President Barack] Obama's policy is different because he is open to talk with Moscow about combining efforts of Russia, the United States and other countries to strengthen common security. The Americans believe this policy could help remove suspicions that their "shield' is aimed against Russia.
Russian military analysts, even radically minded ones, think that Russia is quite capable of influencing Iran, through assistance for its nuclear program and through conventional weapons supply deals, especially involving air defense equipment.
However, certain experts believe the current delicate situation should be handled within the general scheme of U.S.-Russian interaction, not only with relation to Iran's nuclear problem.
Russia and the United States are currently probing each other's resolve on the key issues, including nuclear disarmament and missile defense. America may soon propose a profound cut in nuclear potentials, in a bid to trade off its planned missile shield against Russia's real nuclear potential. However, given the current financial situation, the shield might never be built, especially given its questionable workability.
If Russia accepts the proposal, it will be compelled to join the conventional arms race, just to keep up its status.
So far, the United States has not abandoned a single decision, such as NATO expansion, moving its missile bases from Western to Eastern Europe, militarization of the outer space and the Arctic, or military operations outside NATO's zone of responsibility. More over, Washington is continuing its strategic dialogue with China.
Therefore, many Russian analysts are wary that the proposal that Russia try to persuade Iran might also be a trap.


Moscow wins nuclear tender in Turkey

Already this spring, Russia could get a contract to build a nuclear power plant in Turkey. Experts warn, however, that Russian industry may be swamped by a sea of nuclear orders.
Russia's Atomstroyexport has won a tender to construct four nuclear power generating units in Turkey costing a total of $18-20 billion, and will soon submit documents to the Turkish government for approval, said Energy Minister Sergei Shmatko. According to him, the Russian company will also run the plant, while the Turkish government will guarantee the purchasing of its power over a period of 15 years, to the sum of $60 billion.
Six companies bid in the tender announced in March 2008, said Atomstroyexport spokesperson Irina Yesipova, but only the consortium of Atomstroyexport, Inter RAO and Turkey's Park Technik had a real project. According to Yesipova, the plant will be located 200 kilometers from Antalya, each of its reactors will have a capacity of 1,200 MW, and the price of one kilowatt/hour of electricity will be fixed at $0.15. One unit will take seven to eight years to build, she said, and if the contract is concluded, the first could be commissioned in 2016.
The plant construction contract will be signed after the Turkish government makes a decision. There is no formal deadline set for it, but Timur Ivanov, Atomstroyexport first vice president, expects an answer by spring. He said that Turkish industry would be used to the full in building the plant at the Akkuya site. The project will be 100% financed by the consortium.
Russian industry will find it difficult to cope with the mounting amount of orders, said Valentin Ivanov, a former deputy nuclear power minister. Given favorable conditions, it can build one generating unit a year, while President Medvedev has announced plans to complete 26 units by 2020, he said, with another five being built by Atomstroyexport in Iran, India and Bulgaria. Construction of the second stage of the Tianwan nuclear plant in China could start in the near future, and a contract to build a nuclear power plant in Belarus is under discussion, Ivanov said.

RBC Daily

Exxon to curtail Sakhalin projects

Exxon Neftegas Limited, the operator of Russia's largest oil and gas project involving foreign capital, Sakhalin-I, cannot come to terms with Russian officials.
Exxon Mobil said it had curtailed development of two of its three fields in Sakhalin, Odoptu and Arkutun-Dagi, because the project's budget for 2008 and 2009 had not been approved.
The probable recoverable reserves of the Sakhalin-I oil and gas project off Russia's Pacific Coast have been estimated at 307 million metric tons (2.26 billion barrels) of crude and 485 billion cubic meters (17.12 trillion cu f) of natural gas. By September 2008, the company had produced 20 million metric tons of oil and 3 billion cubic meters of gas.
Project participants are Exxon Neftegas Limited (a subsidiary of Exxon Mobil Corporation and project operator, 30%), Russia's Rosneft (20%), India's ONGC (20%), and Japan's Sodeco (30%).
The Russian Energy Ministry said the project's 2009 budget should be cut by 15%-20% because the prices of commodities, work and materials have plunged.
According to the ministry, the 2008 budget estimate for Sakhalin-I was approved in December 2007, but the operator said last September it needed to increase the budget by 50% because of inflation and because it had initially underestimated the cost and volume of work to be done under the project.
This required a review of the documents, a process that is not yet complete.
The 2009 budget should by cut by 15%-20%, the same as has been done for the Sakhalin-II and the Kharyaga projects.
Tamara Kasyanova, head of the 2K Audit Business Consulting, said officials could explain their demand by the fact that the Russian companies working under the project are short of liquidity and the prices of commodities, work and materials have plunged.
The sides will have to work out a compromise, and Exxon Neftegas will most likely have to accept it because curtailing work on the two fields would cost it too much.


Government set to reduce top bank managers' bonuses

Deputy Prime Minister and Finance Minister Alexei Kudrin said his ministry was drafting proposals to reduce the bonuses of top bank managers. Analysts said corporate top managers would probably have to cut wages in exchange for federal budget subsidies.
Market analysts said last September that the stock market slump would reduce top bank managers' bonuses. Last year, Russian banks' profits totaled 406 million rubles ($11.7 million), a 20% decline on 2007. Thirty-nine banks, including major market players, were in the red.
Analysts say top managers' bonuses will be directly proportional to state subsidies received by banks. "Even if top managers reduce their bonuses ahead of schedule, a possible state assistance package will depend on this factor and some other parameters," National Rating Agency CEO Viktor Chetverikov told the paper.
Mikhail Matovnikov, CEO of Interfax news agency's Center for Economic Analysis, said only state banks and those receiving subordinated loans would be covered by bonus restrictions.
"It is impossible to force private commercial banks receiving insignificant state assistance to reduce bonuses because this decision is made by principal shareholders assessing their performance," Matovnikov told the paper.
Many bank employees could resign due to excessive bonus cuts, said Anton Danilov-Danilyan, chairman of the expert council at the magazine Delovaya Rossia (Business Russia).
Sergei Moiseyev, director of the Center of Economic Studies at the Moscow Academy of Finance and Industry, said top managers at state banks would be able to circumvent the Finance Ministry's possible bonus restrictions.
"Companies will be able to compensate their managers in other ways, including paying their rent and telephone bills, and involving them in the work of subsidiaries' boards," Moiseyev told the paper.

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