Russia is about to be left without revenues from natural gas
If "not all things are calm in Baghdad", then - to be exact - "all hell was let loose" in Russia. News about another failure of the gas industry was added to the overall collapse of the economy, beginning of mass starvation and hysteria due to coronavirus.
Russia's budget consists of at least 50% of revenues from the sale of oil and gas. Therefore, the destruction of this industry threatens to put Russia on the sidelines of the world economy.
We have already come to terms with the fact that the incompetent CEO of Rosneft, Mr. Sechin, created the damping war, brought down the market and almost buried the Russian oil industry. Saudi Arabia showed "who the boss is" with great ease and facility, and entered the European market with an offer of $11 per barrel. In order to not delve too much into the prices in the world market, it is enough to imagine what will happen if they start selling Snickers for 11 rubles in stores. In a couple of months, the entire confectionery market will "collapse", and by the end of the year, all companies without exception will go bankrupt.
Fortunately, this was only blackmail – the brainless donkey was driven back into the OPEC+ zone and the Saudis calmed down for the time being. In any country, a manager like Sechin would have been kicked out long ago without severance pay, but not in Russia. Mr. Putin, who followed the lead of a narrow-minded government official, endured a slap in the face from the global community and at the same time reappointed Sechin for another 5 years.
What did you expect, how is it possible to dismiss his "best mate" Sechin?! For the next 5 years, he will help Maria Vorontsova, Putin's eldest daughter, absorb the $1 billion which was allocated for genetic research and already reserved in the Russian budget. It doesn't matter that both of them have nothing to do with genetics. As you know, there is no one else in Russia to develop advanced technologies. Putin's second daughter, Katerina Tikhonova, is not a technology engineer, and neither does she have a managerial education. But this does not stop her from absorbing the second billion dollars from the budget, under the wise leadership of another friend of Putin, Mr. Timchenko. Evotech-Mirai Genomics LLC is a monopolist, although the diagnostic test systems for coronavirus are purchased at a price almost twice that of their competitors' analogues. The second daughter’s company was completely created through the budget for one of the programs of the National Technological Initiative (State Science and Technology Initiative Fund). That is how Mr. President transfers funds from the budget with one hand, and decides what will be absorbed by which of the daughters - with the other hand.
Well, while Mr. Putin, brings his children into the world of big business with the help of his friends, the country's key industry continues to be destroyed by dabblers. After all, no matter how hard you try to hide failures, they are like pus in a wound, they will build up and appear for everyone to see.
This year, only taking into account the mistakes that Gazprom's management has already made, budget revenues will be three times less than in 2019.
The deal with China is about to be broken. It was signed for 30 years for an annual supply of 38 billion cubic meters of gas. This is minus $400 billion dollars or 1.5 trillion rubles annually. The Chayandinskoye field could not provide the necessary volume of production in the first place, but it was "designated" as the main one, despite all the warnings of experts. Mistakes in the design of the gas pipeline led to the fact that 2 trillion rubles spent on the creation of the gas pipeline went literally "down the drain". Gazprom had the opportunity to conduct a gas pipeline so as to provide gas to the settlements of the Zabaykalsky Krai, Yakutia and Primorye. But the chosen route diverted attention away from the needs of the regions. Apart from the breach of obligations to the People's Republic of China, the problem of repair was added due to the faster and more destructive extractive practices. 34 wells have already failed. That is a loss of another 2 billion rubles.
Now, in order for Power of Siberia to work, a new gas pipeline, Power of Siberia 2, is being built. This is a very Russian option: spending 4 trillion rubles to save 2 trillion rubles and at the same time push back the project's payback by another 10 years. This is if China does not find a more promising option. That's how all the 4 trillion rubles will go down the drain.
By the way, we are not given any guarantees that with such guidance, the money earned by Russians will not be "weirdly" used again. The new gas pipeline will be built by those responsible for the failure of the previous project.
Europe is slowly but surely refusing the supply of our gas, even though the price has fallen. The contract for gas supply through Poland ended on May 16 and will not be renewed. Gazprom was able to reserve the necessary capacity and will supply fuel to Europe through alternative branches. But this is already a different amount and much less money earned.
Now a German company LTW (a subsidiary of Uniper) is building a floating storage regasification unit. It will take liquefied natural gas from incoming tankers in the North Sea. The capacity of the LNG terminal will be about 10 billion cubic meters of gas per year. Given the current needs of Germany, it will cover about 30% of the missing volume purchased from Russia. Accordingly, Russia will sell even less to Germany next year.
The construction of Nord Stream 2 is blocked in Denmark until at least September. The company responsible for the construction of the gas pipeline, Nord Stream 2 AG, has not yet submitted an updated plan for approval to the Danish energy agency. It just decided to not provide it. However, the Danes "listen" to the United States and very slowly consider any documents on the application for construction from Russia. Meanwhile, the US is preparing new sanctions – which will finally bury the construction of the gas pipeline – against Russia.
In the meantime, Germany has issues with the unfinished project. The project does not meet the requirements of the new energy pact: the separation of gas supply and transportation activities, as well as access to them by third parties. Nord Stream 2 AG is fully owned by Gazprom, so the pipeline can only be HALF loaded.
Gazprom was granted €4.5 billion from the budget for the construction of Nord Stream 2. And although the project is being done in the interests of European countries and on the terms of co-financing – for the US, compensation of these funds to NATO partners is absolutely not a problem – they will supply weapons for this amount and close the issue. But no one will compensate Russia, which is building the pipeline, for the sunk cost due to disruption of deadlines for finishing the pipeline that was to be done in May 2020 or the fact that it won’t work at all.
Someone will say: these are the new rules of the game - falling gas prices due to coronavirus, selling contracts through auctions, Europe has long wanted to become self-sufficient in oil and gas, the US sanctions and standoff. All this is true, but for some reason it is overlooked that these trends are over 5 years old. Gazprom's management should have taken them into account in its policy long ago and should have suggested adequate solutions to avoid losing profits.
But it just "sits" on the gas pipe and feeds from it, receiving huge salaries. It does not forget to ask for funds from the budget for the construction of new, non-working gas pipelines as well. Yes, despite the collapse of the economy and huge failures, Gazprom still has 35,000 people in its management, and there are no plans to cut wages or lay off employees due to the plight of the business. It’s because all losses in the budget will be compensated at our expense. Prepare for an increase in household gas prices.
A question arises: what is Mr. President doing when our country is openly robbed and pushed out of the international arena? After all, he is "our advantage", according to Mr. Volodin.
Nothing actually - he is having a fiesta in the Novo-Ogaryovo bunker.
In a few more years, Russia will be finally removed from the "oil needle" without our consent. Because incompetent politicians and even less competent government officials show complete ineptitude, destroying the industry that has fed the country for more than 100 years. That is why Mr Putin and his people have been talking so much about innovation and making headlines about all sorts of inventions lately.
They talk, talk, and talk again, but don't plan to do anything - they are neither capable nor willing to.
Putin had 20 years to turn the country from a raw material economy to an innovative and digital future. But instead of building new industries and renewing science, Mr. President turned to building temples and also providing for his family for ten generations to come. However, concerning the future of Russia, he and his corrupt friends acted in three ways: all the money provided in the budget for the programs for development- was stolen, new promising businesses were either seized by raiders, or crushed if their owners refused to sell them for peanuts.
But Mr. Putin wants more. He is preparing for the next 20 years of his rule. He decided, so to speak, to "start over with a clean slate" and reset the terms of his presidency. After all that he has done to the country, he still has the audacity to talk about the future of Russia!
I have a friend, all living things around her die. Dogs, cats and parrots that were given to her – no animal could live more than two years. Even plants don't survive in her apartment. There is no sorcery here - the woman is simply not paying attention to the tiny creatures: when she remembers, she gives them food and water. However, she puts what she feels like putting in bowls, instead of what is needed for their well-being and growth.
Mr. Putin, apparently, is from this breed of "owners". So we should be surprised that we are still alive. After all, for the last few years, he has been openly trying to ruin the economy, small and medium-sized businesses, and he has already deprived several million people of their jobs through his inaction and negligence.
I don't think it is necessary to explain what the future holds for us under his hand?
I hope that we are not dumb cattle and will not wait until Putin and his accomplices steal everything they can, and wreck everything else and deprive us of even "chance morsels"? Do not wait for the moment when your family will begin to starve to death and you will be robbed right at your front door. Help the opposition to throw off the incompetent politician who wants to become a dictator! Participate in any form of protest against amendments to the constitution as soon as the opportunity appears in your region!
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https://www.bbc.com/russian/features-52470990
https://www.mk.ru/economics/2020/05/27/neftyanuyu-iglu-v-rossii-zamenit-cifrovoy-kolpak.html
https://lenta.ru/news/2020/05/28/gazprom11/
https://www.mk.ru/economics/2020/05/28/gazprom-poteryaet-v-evrope-1015-mlrd-dollarov.html
https://www.mk.ru/economics/2020/05/28/v-germanii-poyavitsya-alternativa-severnomu-potoku-2.html