Gazprom Export chief shrugs off cartel claims

Gazprom manager Alexander Medvedev has hit out at European politicians and competition watchdogs.

Asked whether Eastern Europe (EE) must brace for another gas crisis this winter due to the conflict between his company and Ukraine, the Gazprom deputy chairman told Austrian newspaper Die Presse: “(The) energy (sector) has always been connected with politics, but not with political show. We have been observing the staging of such a show by Europe recently.”

Medvedev heads the Russian gas company’s export branch Gazprom Export. European Commission (EC) investigators searched the offices of Gazprom and around 20 other energy sector firms operating in Europe in September. The EC suspects their involvement in a possible cross-country cartel.

A spokesman for OMV AG announced that the Austrian company would “of course fully cooperate” with experts sent out by the EC to clarify the issue. The offices of the Vienna-based enterprise were searched too.

“If there is a company with intentions to create competition then it is Gazprom. We don’t dream of sky-high prices, we only want to earn what was invested. There has been a will to abandon fair prices since the crisis,” Medvedev told Die Presse about the cartel allegations.

Speaking about the current crisis in the Eurozone, the group of 17 European Union (EU) members which use the Euro as their currency, Medvedev said: “We put trust into the leading Euro(zone) states. Russia offered its help, but based on economic cooperation. Europe would harm itself by preventing us from investing into the production of electricity or the creation of pipelines.”

Gazprom masterminds the Nord Stream project, an offshore natural gas pipeline of a length of 1,222 kilometres from Vyborg in Russia to Greifswald, Germany. The Nord Stream endeavour has been under scrutiny for possibly making Europe more dependent on Russian gas. Those in favour of the project point out that Europe would benefit from cooperation with the large Eurasian country in economically difficult times.

Nord Stream is expected to reduce Europe’s cooperation with other Eurasian nations with large gas reserves. The project, which was inaugurated earlier this month, also puts more pressure on OMV bosses who are in key positions of economic partnerships behind Nabucco.

The Nabucco pipeline is supposed to bring gas from the Caspian Sea to the Austrian province of Lower Austria from where it would be transferred to several European countries. Its construction was postponed to 2013 after suffering setbacks of political and economic background. Planners recently said Nabucco would start transferring gas in six years while business press speculate that the project could be scrapped.

OMV is headed by Gerhard Roiss who said in September the firm would invest 2.4 billion Euros in the next 10 years altogether. He explained that a firm-internal efficiency programme would be carried out at the same time. The Republic of Austria’s Federal Industry-Holding Stock Corporation, ÖIAG, holds an interest of 31.5 per cent in the company which has more than 31,000 employees in Austria and abroad.

Asked whether a decline of gas prices was possible due to overcapacities and the increasing share of shale and liquid gas on the market, Medvedev said he doubted whether shale gas would establish itself for economic reasons. “And there are, of course, limits to the infrastructure for liquid gas. (…) There is no cheap gas and there will be no cheap gas ever again,” the Gazprom Export boss told Die Presse.