Putin expresses concern over Gazprom raids
Vladimir Putin - Photo EC
(MOSCOW) - Prime Minister Vladimir Putin warned EU nations on Monday that Russia would be carefully monitoring an unprecedented anti-trust probe launched against its powerful natural gas monopoly Gazprom.
The cautionary comments marked Putin's first response to a high-stakes dispute that threatens to dominate Russian-EU relations on his expected return to the Kremlin after a 2000-2008 presidency in March.
Gazprom had previously confirmed the offices of its trading partners and subsidiaries being searched -- and documents seized -- in the EU's most forceful response to a growing European outcry over alleged price collusion.
But Russia's richest and most strategic company said little else about the raids in an apparent attempt to play down the impact of a probe that could alter how Europe pays for nearly a third of its natural gas.
That relative silence was broken on Monday when Putin received Gazprom chief Alexei Miller for a rundown on his efforts to boost European exports.
"The Russian government will be carefully monitoring what is happening around Gazprom. I ask you to report on this in a timely manner," a stern-faced Putin told Miller in nationally-televised remarks.
The former KGB colonel then demanded to know whether EU nations had arrested any Gazprom or other officials as part of their raids.
"No, Vladimir Vladimirovich, they have not arrested anyone yet," Miller replied in comments that lead Russian state TV news.
"Thank God," Putin replied in an apparent effort to underscore the importance he personally attached to the case.
The EU probe culminated weeks of grumblings from Russia's top clients and put Gazprom -- its growth stalling and competition from North African suppliers gathering pace -- under the sort of pressure it has not seen in years.
Ukraine has threatened to join the German firms RWE and E.ON in arbitration against Gazprom and the giant this weekend also saw its second-biggest client Turkey refuse to renew a contract it has held since 1986.
Miller said nothing of the pending court cases but called the searches "completely unexpected".
"They came as an unpleasant surprise," Miller said.
His first deputy Alexander Medvedev also played down the significance of the lost Turkish contract and expressed confidence that "new private company clients" can fill in for Turkey's state-run Botas.
But industry sources quoted by Russian media reported a sense of trepidation running through Gazprom's ranks.
The Kommersant business daily in particular wrote that Gazprom was stunned to see its European partners "not even resist" the raids and hand over their documents without protest.
The probe was launched just weeks after Putin made an undisguised show of Russia's plans to expand its gas ties with Europe and thwart pipeline alternatives such as the Nabucco link being promoted by the United States.
Nabucco's Russian competitor South Stream hopes to start funneling gas by 2016 while its Nord Stream counterpart under the Baltic Sea will unload its first deliveries in Germany on November 8.
"We are working according to schedule," Miller said in reference to the South Stream project that was initially launched with Italy's ENI and now includes partners from Germany and France.
Miller said Gazprom was also pushing ahead with plans to complete a second Nord Steam line running parallel to the first that will double the link's total capacity.
"We have already built 700 kilometres (435 miles) -- this is about 60 percent," Miller said.
Putin also instructed the Gazprom chief to quickly report back with proposals to expand ties with the still largely-untapped markets of Japan and South Korea.