UPI Energy Watch

Gazprom, Transneft acquire right to bear arms

Russian gas giant Gazprom now has a right to set up its own armed units after Russian lawmakers gave the gas utility and Transneft, the state oil pipeline monopoly, the power to create armed units to defend their installations.

The Duma, the Parliament's lower house, passed a bill that would allow two Russian energy giants to recruit and arm their own security forces, giving them greater powers than private security firms, according to media reports.

The decision gave Gazprom and Transneft exemption from strict limits on private businesses wielding arms.

Supporters of the law argued that there is a need to improve the protection of oil and gas pipelines from militant attacks.

Alexandr Gurov, a Duma deputy who drafted the Bill, said, "A couple of terrorist acts and an ensuing ecological catastrophe would be enough to immediately declare Russia an unreliable partner and supplier of energy."

But other lawmakers disagree.

"This law is like a Pandora's Box," said Gennady Gudkov, a lawmaker with the left-wing Fair Russia party who opposed the law. "Gazprom and Transneft are proposing the creation of their own corporate armies."

The bill passed 341-109 on Wednesday.

Kazakh, Croatian leaders hold energy talks

Kazakhstan has expressed an interest in exporting oil and gas resources to Croatia and other countries in Western Europe through Croatia.

"Energy is certainly an important aspect of our cooperation. We are interested in supplying the Kazakh oil and natural gas to Croatia and further to Europe through Croatia," Kazakh President Nursultan Nazarbayev told reporters after a meeting with his Croatian counterpart, Stjepan Mesic, in Astana Thursday.

Nazarbayev said, "Kazakh companies are keen to develop Croatian oil and gas pipelines, and they also want to become shareholders of oil refineries and sea ports (which have access to) Europe."

Kazakhstan would like to transport oil through such routes as the Constanta-Pancevo-Trieste and the Fiendship-Adria oil pipelines.

"We are interested in a pipeline along the Constanta-Pancevo-Trieste route. I have told the Croatian president that Kazakhstan will also be able to take part in the Friendship-Adria oil pipeline," Nazarbayev was cited as saying by Russian news agency Interfax.

"Croatia's geographical position is very handy to go there, to reach Eastern Europe and further other countries through Croatia. We are interested in this," he said.

Russian energy firm to invest $2B in Uzbekistan

Russian oil and gas firm SoyuzNefteGaz said it plans to invest more than $2 billion over a period of 36 years in the projects being implemented in Uzbekistan's fuel and energy sector.

Rinat Anderjanov, the head of the company's representative office in Uzbekistan, told Regnum news agency that the two sides decided to work together during a Russian-Uzbek intergovernmental commission for economic cooperation, headed by Russian First Deputy Prime Minister Sergey Ivanov and Uzbek Prime Minister Shavkat Mirziyoyev, in Tashkent on Wednesday.

Anderjanov said the Russian firm will secure a production-sharing agreement to conduct operations in Uzbekistan.

SoyuzNefteGaz Vostok Ltd., which is a subsidiary of SoyuzNefteGaz, was set up to implement this agreement and has already started extracting oil at two oil deposits in the country.

Anderjanov said: "In June, our subsidiary began drilling work which is being carried out as part of an agreement with the Gazprom open joint-stock company. Gazprom is carrying out exploration work in the Ustryurt region in Uzbekistan. At the same time, the company is starting the implementation of a project to construct an elite residential area in the Uzbek capital, where it is planned to build housing and business complexes.

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Closing oil prices, July 6, 3 p.m. London

Brent crude oil: $73.80

West Texas Intermediate crude oil: $71.73

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