| The French company is going to reconsider its business development strategy in Russia The recent statement by Minister of Natural Resources Yuri Trutnev regarding the prospects for foreign participation in the development of Russian subsoil has frightened foreign companies. France's Total said it is going to reconsider its investment strategy in Russia. True, not all Western holdings intend to join it. For example, Shell told the Vremya Novostey newspaper that they do not intend to change their plans. And eastern companies, such as the Chinese CNPC or the Indian ONGC, on the contrary, are rushing to Russia.
As Mr. Trutnev has been saying every day for a week now, the Ministry of Natural Resources and Rosnedra have decided not to allow companies that “constitute a group of persons with foreign legal entities, foreign citizens and stateless persons” to develop Russia’s largest deposits. If a consortium is created, “at least 51% must belong to Russian participants.” Immediately after this, the Ministry of Natural Resources canceled the auctions for the deposits already scheduled for the end of March. Roman Trebs and Anatoly Titov, who were recognized as strategically important (the previous conditions for holding auctions did not provide for restrictions for foreigners).
“The position of the Ministry of Natural Resources imposes serious restrictions on our actions,” Total’s head for Europe and Central Asia, Menno Gruvel, said yesterday in an interview with the Izvestia newspaper. “We will still discuss these new risks, but it is already clear that the minister’s statement may force us to reconsider our investment strategy in Russia.” However, according to Mr. Gruvel, Total still gives preference to working within projects and is ready to cooperate with Russian partners, as it considers this “the best way to do business in Russia.” Moreover, in the future she does not exclude corporate transactions, such as the purchase of a blocking stake in NOVATEK.
Most likely, the French are not very upset by the prospects outlined by Mr. Trutnev, especially since Total has not yet worked single-handedly at any field in our country. Rather, Western holdings, in principle, fear for their future in Russia, assuming that after some time the Kremlin will not be happy to see them on their territory.
Economic Adviser to the President Andrei Illarionov, known for his liberal statements that are fundamentally at odds with the “general line” of the state, is also confident that Mr. Trutnev’s statements characterize the development model chosen by Russia. The presidential adviser emphasized that if a liberal model is chosen, “then the country’s subsoil, like other assets, should belong to private owners and can be sold at open auctions with the participation of everyone.” However, Mr. Illarionov noted that “if the model of economic development is called “state capitalism,” then in this case everything belongs to the state.” Ivan GORDEEV |
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