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  Tuesday, August 16, 2022
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Liberalization of the Gazprom stock market will lead to an investment boom in the sector,
Liberalization of the Gazprom stock market, coupled with clear rules for accessing the pipeline, will lead to an investment boom in the sector, Andrei Sharonov, deputy head of the Economic Development and Trade Ministry, said in an interview with the World Energy magazine. This interview has been posted on the ministry's web site. The gas sector will become more attractive to independent investors, Sharonov said. In conjunction with tough, intelligible rules for accessing the infrastructure, this may prompt an investment boom in the sector, which is a welcome prospect given the difficulties that Gazprom is having in attracting the needed amounts of investment. Liberalization of the Gazprom stock market will become a possibility after the gas major takes over the government-owned oil producer Rosneft. It will raise Gazprom sharers' liquidity and increase the capitalization of this particular company and the entire stock market, the deputy minister said. According to Sharonov, one negative aspect to the Gazprom-Rosneft deal is that it will break the sequence in reforming the sector. "In this case, we are adding competitive operations to a natural monopoly. While the classic model for reforming natural monopolies requires that we do the direct opposite," the official said. He believes that "this is rather an intermediary step, after which [we] will have to go back to the issue of separating monopoly and competitive operations." On the positive side, the reform will bring the natural gas prices up, Sharonov said. According to him, the higher prices will change consumer attitudes. Consumers will come to realize it is wasteful to burn natural gas and may opt for energy-saving technologies instead. And this will reduce the consumption of natural gas and other fuels by the Russian economy, concluded the deputy minister. Sharonov said he was cautiously optimistic about progress in the energy sector reform. "Reform is making headway; the action plan of the government and the UES (the Unified Energy Systems electricity giant) is being implemented," he said. "Unfortunately, we have not yet been able to decide on specific modes for the sale of shares in wholesale generating companies. But I hope that the government will do that sooner or later." In reply to a question as to whether the EUS split is likely to be followed by a re-merger, Sharonov said that everything will depend on the rules to be set. "Re-merger may be completely impossible or impossible during some transitional period in case such processes are brought under a strict anti-monopoly control," he said. "We need to figure out how the market will work with the advent of independent or quasi-independent players before the sale of wholesale generating companies, whether there will be competition, as we have anticipated, and how it will influence the pricing and the investment activity," the Deputy Economics Minister explained
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