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  Thursday, September 24, 2020
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Vladimir Putin called upon gas state monopoly Gazprom on Friday to spend at least $1 billion on developing natural gas supplies to the country's remote areas
Russian president Vladimir Putin called upon gas state monopoly Gazprom on Friday to spend at least $1 billion on developing natural gas supplies to the country's remote areas. Vedomosti, a leading business daily, reported today that analysts warned this might hamper Gazprom's huge acquisition plans. As the Russian government is going to buy 10.74% of Gazprom's shares for $7.1 billion to consolidate control, the company and government officials are already thinking of possible acquisitions. The monopoly has been interested in many assets, ranging from Lithuanian refinery Mazeikiu Nafta to stakes in Sakhalin gas projects and Russian oil major Sibneft. Gazprom managers have repeatedly said the company will opt for majority shareholdings. Andrei Kruglov, Gazprom's chief financial officer, suggested Gazprom use part of the money to optimize the monopoly's debt portfolio. The government, however, appears to have its own views as to how to use the money, which analysts have called a sort of additional tax imposed upon the gas giant on top of the official $1-billion sales tax. Experts say urging Gazprom to invest in public gas networks would be justified if the concern were to receive certain tax breaks in return. Vladimir Milov, the director of the Institute for Energy Policy, said in the paper that Gazprom would now have to give up its plans for Sibneft and called the investment plans politically motivated. "If the government is going to get Gazprom to spend the earnings from the deal on its core activities, a better way would be to see the money spent on production or new trunk pipelines," he said.
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