Nationalisation and Privatisation: Two Industry Development Tendencies

Experts have been saying in the last few years that state capitalism is being developed in Russia which allegedly began with the oil and gas industry. An opinion can often be encountered that Putin’s reign has become an era of nationalisation. Meanwhile, it is hardly worthwhile evaluating the situation with property in the oil and gas sector with so little space for ambiguity. One has indeed seen the nationalisation of Yukos assets, but one has also seen an IPO of Rosneft, growth in foreign owners’ share of Gazprom, and the privatisation of SIBUR which is currently in full swing. Remember also that Putin’s presidency began with privatisation deals, for example the sale of Slavneft.

Most probably, the problem is subtler. It is not ruled out that the nationalisation stage has been but a part of a larger-scale process wherein the Putin elites are gaining control of property in the oil and gas sector. This in turn cannot be achieved without the final privatisation of the most important assets. For this is the only way to insure the property against political risks.

Private property and political stability are the two elements of the long-term project for change of the sector owners. Curiously enough, the two stages of the Putin plan have overlapped: nationalisation is still in progress, but privatisation is also in full swing.

All these issues will be dealt with in the new Report. It will cover in details the following topics:

• «Oil and gas magnets»

  • Whom assets are registered to and what companies are the winners in the Putin-sponsored nationalisation of the industry
  • Slices of the oil and gas pie gained by Rosneft, Gazprom, and Gazprom Neft
  • Surgutneftegas as the first private company of the new political model

• Potential victims

  • Which companies risk changing hands to the benefit of the Putin-supervised clans of bureaucrats and politicians
  • Survival strategies for TNK-BP, Lukoil, RussNeft, Bashneft, and Tatneft

• Wars for assets

  • Showdowns between the Putin-controlled clans over the property they gain
  • Conflict over SIBUR and Gazprom’s oilfield licences and showdowns over offshore licences

• Extraction privatisation

  • Beginning of the privatisation of state-owned assets
  • Privatisation of Gazprombank and a number of other Gazprom units
  • Transfer of state-owned fields to Gazprom and Rosneft as a latent form of privatisation
  • Future of Rosneftegaz

• Medium-term forecast of developments

The contents of the report: