MIPC/MMNK Executive Committee’s Report on Work Done in 2005

 

Club’s work was carried on in accordance with the plan of Activities approved at MIPC Annual Meeting 15 December 2004, along the following main lines:

 

·         Maintaining regular dialogue and holding meetings with the representatives of the federal legislative and executive brunches, regional leaders and prominent Russian public and political figures, with prominent businessmen;

·         Participation in the legislation process, particularly in working out a new Law on Subsoil Resourses, a Law on liberalization of the natural gas market in Russia and the Gazprom securities market;

·         Participation in international projects within the framework of the Energy Security Forum of the UN European Economic Commission; in the Ludvig Nobel project (creation of the St.-Petersburg Nobel Heritage Foundation, resurrection of the Ludvig Nobel Award for petroleum and metal industry, preparation of a Conference on the Nobel Family Heritage in Russia) – within the Russian Oil and Gas Week.

·         As a specific direction of work there has been and will continue to be in 2006 MIPC representatives’ participation in the activities of a special working group headed by Academician E.P.Velikhov and Professor E.S.Nabiullina, Director of the Strategic Research Center of the R.F. Ministry of Industry and Energy to prepare recommendations for G-8 on ensuring global energy security in the world and creating a collective system to make global energy security efficient.

·         The Club kept viewing as important its participation in the energy dialogues of Russia with the United States, the European Union, OPEC, Asiatic and Pacific Region, maintaining contacts along the line of the activities of the Duma-US Congress Working Group, CIS Parliamentary Union, Russia’s Bilateral Government Commissions with Great Britain, France, Kazakhstan, Azerbaijan.

·         Contacts with public organizations and mass information media, with science and research centers, Russian Academy of Sciences, Russian Academy of Natural Sciences, MGIMO of R.F. Foreign Affairs Ministry, the Gubkin Russian State Institute of Oil and Gas, the Moscow State University and other sisterly Russian and foreign consultative organizations (Russian Union of Industrialists and Entrepreneurs, AmCham, PAF, the Union of Oil and Gas Industrialists, Association of Small and Medium Oil Producers) – were in the focus of MIPC work all through the year.

·         In 2005 as in the previous years topical meetings and discussions in the format of round table and direct dialogue were held with the Natural Resourses Minister Yu.P.Trutnev and his Deputy Natural Resourses Yu.A.Podturkin, Director of the Federal Energy Agency S.A.Oganesyan and his Deputies V.V.Kuznetsov and O.G.Gordeev, with the Chairmen of the State Duma Committees on Energy, Communications and Transportation V.A.Yazev, on CIS Affaires A.A.Kokoshin, on Natural Resourses N.V.Komarova, with the Chairman of the International Affairs Committee of the Council of Federation M.V.Margelov, the President of the Russian Union of Industrialists and Entrepreneurs A.N.Shokhin, the Head of the Expert Department of Presidential Administration A.V.Dvorkovich and, the last but not least, the MIPC Annual Meeting took the shape of discussion by the Club members of vital issues with the Industry and Energy Ministry top executives in charge of the oil and gas sector and international energy cooperation.

·         Substantial and constructive nature of meetings and discussions within the Club to our mind allowed MIPC members to evaluate more correctly the situation in the oil and gas industry of Russia, its present state and prospects, to better understand Government’s policy in this field. This was particularly important taking into consideration the ever growing new role of Russia in the world distribution of energy against the background of high prices of hydrocarbons in the world and scarcity of new energy sources. The principal oil producers of the OPEC nations are within the instability arch thus making the importance of Russian oil and gas in 2005 considerably higher.

·         2005 has been marked by consolidation of oil and gas resources and by a sharp rise in the capitalization of a number of major Russian companies, particularly of Gazprom, LUKoil, TNK-BP. The state oil company Rosneft after the acquisition by it of the Yugansneftegas assets has in fact become Russia’s second company in terms of production and exportation of oil. Serious decisions were taken this year also in pipeline transportation. The Blue Stream gas pipeline has been officially committed, with prospects of construction of a new gas pipeline and (or) oil pipeline. By and large Turkey is becoming a key partner for exportation of Russian oil and gas to the rest of the world. Decision has also been taken on constructing the so-called Eastern pipeline.

·         Participation by MIPC representatives and experts in the legislative work, in the preparation of pertinent recommendations and suggestions for the Industry and Energy Ministry, the Economic Development and Trade Ministry and the profile State Duma Committees took place on a constant basis and reflected the positions and interests of the Club member companies.

·         Special attention has been given to the new draft of the Law on Subsoil Resourses, the draft Law on liberalization of the natural gas market and to other important legislative acts which are shaping up the legislation as a whole for the energy sector. This work naturally should be constantly done in 2006 as well.

·         MIPC representatives took part in the First regional conference of the Energy Security Forum of the UN European Economic Commission 27 June 2005 at the UN Headquarters in Geneva which considered the energy security situation in the Caspian region within global context. Within the framework of the Russian Oil and Gas Week (end of October-first days of November) they gave active support to preparations for Russia’s leadership in 2006 in G-8, to holding a special seminar of high representatives of G-8 countries on energy security and energy efficiency. At a request of the Presidential Administration MIPC representatives have been included into the team of drafters of papers on that theme lead by Academician E.P.Velikhov and Professor E.S.Nabiullina. They will proceed with this work in 2006 up to the G-8 Summit in July in St.-Petersburg.

·         In view of the fact that certain pause occurred in 2005 in the energy dialogues Russia-US, Russia-EU on Club’s initiative consultations were held between MIPC and the Russian Union of Industrialists and Entrepreneurs (Alexander Shokhin) aimed at giving a push to these dialogues as important instruments of international energy cooperation. Joint initiatives by MIPC and RUIE should be coming shortly.

·         The Club participated in various public charitable and sponsorship projects. It upkept its ties with the Russian cultural and writing elite. It supported creative activity of the young Russian couturier I.Chapurin, the “World Stars-to Children” charitable foundation, the outstanding Russian artist N.Safronov and others.

·         Special attention was given to Club’s contacts with the Russian and the world news media. The Club is in working touch with the America Illustrated Magazine, with the magazines: Oil of Russia, the Oil Industry, the Oil and Gas Vertical, the Profile, with a number of television networks: NTV, Sky News, Sky Turk and others.