Ice Battle in the Arctic - Igor Sechin vs. Leonid Michelson

The invisible battle between the Rosneft and Novatek companies for a place under the Arctic "sun" continues.
 And it seems that the head of Rosneft, Igor Sechin, is still losing to Novatek’s head Leonid Michelson. And especially regarding the construction of LNG tankers at the Zvezda shipyard in Primorye.

Let us call a spade a spade: Mr. Mikhelson does not like the conditions offered by the Zvezda plant - and the company that belongs to the company Rosneft shares with Gazprombank. I do not like the price - it is much higher than that of the shipbuilders of South Korea. At the South Korean shipyards, Mr. Mikhelson has already built 15 gas tankers. It is clear that construction needs to be continued, since the owner of Novatek launched the fourth line of the Yamal LNG plant. And it seems that soon Mr. Mikhelson can force the entire Northern Sea Route with its gas carriers.

The Rosneft company doesn’t demonstrate such agility in reality, but in words Mr. Sechin promises to take control of everything. He does not intend to miss the Arctic project, so the head of Rosneft then complains to Vladimir Putin about Mikhelson, then colludes with Industry Minister Denis Manturov, then pulls up the USC head Alexei Rakhmanov to resolve the delicate issue. But all these attempts so far break on the virtual ice: Leonid Michelson was allowed to use on the Northern Sea Route those LNG tankers that he already has. He is given a blank check for the further promotion of the Yamal LNG project. And today, the results of Michelson are more brilliant than those of the opponent from Rosneft.

Subsidies amount to 50 billion rubles

But the big game continues ... And the other day, Leonid Mikhelson, who is being offered to build new tankers - gas carriers at the Zvezda shipyard, made a proposal to lower interest rates for the construction of 15 LNG tankers at the Rosneft shipyard for the Arctic LNG 2. project

As an option - it is proposed to place the funds of the National Wealth Fund (NWF) in the accounts of VEB.RF. And VEB.RF should provide the first tranche - $ 5 billion for the construction of gas carriers under the leasing scheme. Revenues from the placement of VEB.RF funds may be used to reduce rates. This writes the "Kommersant".

Leonid Mikhelson, as it turns out, in mid-June sent a letter to Dmitry Medvedev. And asked to solve the issue of high interest rates in the construction of gas carriers. Mikhelson proposed either subsidizing interest rates from the budget, or placing funds of the National Wealth Fund in the accounts of VEB.RF. The participation of the state corporation in financing the construction of 6 tankers at the Zvezda shipyard has already been approved.

Leonid Mikhelson in his letter notes that the cost of transportation along the Northern Sea Route is very high. In order to preserve the competitiveness of Russian LNG, it is necessary to ensure the conditions for financing the construction of LNG tankers not worse than on world markets, and interest rates must be pegged to the dollar.

Novatek decided to build ships for the Arctic LNG 2 project in South Korea, as was done for the Yamal LNG plant, but in the end they decided to send orders to Sechin to the Zvezda shipyard.

The head of the Ministry of Industry and Trade, Denis Manturov, said that subsidies could amount to almost 50 billion rubles.

 
Novatek put on the blades of Rosneft?

It should be noted that Novatek significantly increased its profit in the first half of this year, in 2019, thanks to an increase in the production of liquefied natural gas. In terms of capitalization, the Michelson’s enterprise was entrenched in fourth place among domestic companies. And it should be that in the near future Novatek will be able to get ahead of Rosneft in this indicator. Reports about it "Prime".

Thus, Gazprom and PJSC Sberbank shared the first and second places, Rosneft ranked third, Novatek followed, and then Lukoil.

Earlier, Novatek published a report on IFRS (International Financial Reporting Standards) for 6 months of 2019: the company's net profit rose to 450.971 billion rubles: this is 6 times more, for 6 months of the past, 2018.

Such a jump is explained by successfully launched Arctic projects. Novatek is implementing these projects together with its foreign partners. Experts believe that the increase in liquefied gas production and the implementation of LNG projects contribute to the growth of Novatek’s capitalization, which Rosneft will be able to wipe off its high pedestal in the near foreseeable future.

Experts explain the success of Yamal LNG with the support of the Government of the Russian Federation. The project is exempt from paying mineral extraction tax and export duties for 12 years after the shipment of the first batch of products. But this is on condition that the volume of production in this period of time does not exceed 250 billion cubic meters. m. And for the period of tax benefits, Yamal LNG will receive additional income, which can be more than $ 1 trillion. rubles.

The prospects are awful!

Novatek has already announced the completion of the sale of shares in another project - Arctic LNG-2. The partners were subsidiaries of oil and gas companies CNPC and CNOOC (PRC), as well as a consortium of Japan Arctic LNG. Tekhnoblog wrote about this.

It includes the company "Mitsui" and "JOGMEC" (Japan). The participants of the project "Arctic LNG – 2" and the company "Total" (France).

For Arctic LNG-2, Novatek does not ask for tax breaks or state funding. But the Government of the Russian Federation is ready to provide tax breaks for the industrial cluster in Murmansk. It is in the Murmansk zone that they promise to produce equipment for LNG projects. Novatek is approaching the Northern Sea Route by leaps and bounds.

Sechin offered inventory

It is clear that such a thermonuclear activity of Leonid Michelson does not like Mr. Sechin.

And the head of Rosneft, Igor Sechin, took up the epistolary genre: he recently wrote a letter to Vladimir Putin. In this letter, Mr. Sechin described his vision of the development of the Arctic. He drew a plan for this development, not regretting the colors. And immediately began to beg for tax breaks, only some 2.6 trillion. rubles.

Sechin asked Putin to support the draft law on the development of oil fields in the Arctic. This project provides a special treatment for investors. Speech about "Vostok oil". This miracle project can combine the Payahskoye Neftegazholding and Rosneft fields into an oil-producing cluster - these are areas such as Lodochnoye, Tagulskoye and Suzunskoye.

Recall that a little earlier, Mr. Sechin achieved tax incentives for Samotlor and Priobskoye fields in Western Siberia. But Vladimir Putin unexpectedly imposed a moratorium on the Vostok Oil project. And talked about inventory. Sechin had to listen that new state support measures would not be provided until the completion of the inventory. The government should work on uniform criteria and business justification requirements.

This is a blow below the belt: Leonid Mikhelson, it turns out, received so many benefits and concessions, but Rosneft and Sechin were sent to an inventory!

And then the state corporation Rosatom added fuel to the fire, saying that the year-round navigation along the Northern Sea Route will definitely open from 2030. And the main initiator of the year-round navigation is no, not Rosneft, this is Novatek. About this reports portal "Shipbuilding".

Again, hit below the pager!

New intrigue

But Mr. Sechin is an experienced player. And he has a lot of ideas on how to neutralize a quick competitor.

And the head of Rosneft has already come from another side: he asked Dmitry Medvedev for permission to license the West Irkinsky section on Taimyr adjacent to the Payakhsk deposits with a potential of 500 million tons. Sechin is eager to carry raw materials along the Northern Sea Route.

The West Irkinsky subsoil borders with the Payakhsky group of fields of the Neftegazholding company of Eduard Hudainatov. This is Mr. Sechin's great friend. It is possible that Rosneft’s admission to the development of the site will result in the creation of a joint venture with the Neftegazholding company. And the transportation of raw materials for the Sechin company will not be as big a problem as for the Michelson company: Rosneft has its own tankers.

And it is possible that Sechin can use all his powerful levers of influence.

But will Sechin be able to neutralize Michelson? And can the head of Novatek repeat the unenviable fate of Ex-Minister Alexei Ulyukayev? Recall that Mr. Ulyukayev, after close contact with Mr. Sechin, was sentenced to 8 years in a strict regime colony, inadvertently accepting a Sechin basket of sausages.

It is quite possible that, trying to impose gas tankers from the Zvezda shipyard at space prices to Michelson, Sechin will realize his most cherished dream- will withdraw the Michelson company from the Yamal LNG project.


Is it possible? If you remember that Sechin "uchudil" with Ulyukaev, quite!

But let us recall that Leonid Mikhelson managed to resolve the issue of LNG transportation along the Northern Sea Route under the ban on the use of foreign tankers. After adopting amendments to the Merchant Shipping Code (KTM) in 2017, Novatek, who chartered 15 gas carriers of a reinforced ice class and two tankers to export gas from the Yamal LNG project on a long-term basis, could not use them without the permission of the Government of the Russian Federation. But the Government suddenly removed 26 tankers under long-term contracts from the ban on LNG transportation.

And now these big ships can walk on the Northern Sea Route until 2024. Other ships that chartered Novatek were allowed to transport LNG until the end of 2021.

Michelson, it turns out, everything is fine? All this is a very serious bid for the dominance of the company Novatek in the Arctic.

Mr. Sechin, despite all his opportunities, while he was left with a nose?

But an experienced intriguer does not leave a dream - to plant Novatek at the Zvezda Shipyard. Here and the goat it is clear that the price of gas carriers assembled at the Zvezda plant will be much higher than in South Korea. Firstly, South Korea has been building tankers of this class for many years, and secondly, it is simultaneously building 2-3 tankers for the needs of Novatek. So it turns out much cheaper.

Sechin complains to Putin

At a recent meeting with Vladimir Putin, the head of Rosneft complained about Mikhelson, who stubbornly does not want to build gas carriers at the Zvezda shipyard.

Sechin explained that 160 ships must be built for a stable and profitable shipyard operation. Rosneft itself has already ordered 25 ships, Gazprom scraped 5 ships, Sovkomflot also decided to build 5 new ships, Rosmorport has so far decided to do with one new vessel. But Michelson’s company stubbornly does not want to help Zvezda!

But will the weather make an order for 15 LNG gas carriers for the Star Shipyard? To complete the work of the shipyard need very powerful orders. And where will Sechin pick up so many orders, even if he takes the construction of all new nuclear-powered icebreakers from the Baltic Shipyard? But there are not a hundred of them either, but only 5 ... As an option, can Igor Sechin again gut state-owned banks?

100 billion rubles promises to give VEB. RF. But the shipyard is still under construction ... And Yamal LNG has been working to its fullest since December 2018. And new tankers were needed yesterday.
The cost of building the shipyard "Star" is estimated at 200 billion rubles. But the commissioning of the first stage was postponed again from 2018. Now for 2020. Sechin is very nervous. And looking for the culprit of their failures and permanent turmoil. And Michelson stubbornly does not want to build gas carriers on the "Star". So, all the “poison arrows” must fly to the Novatek host? And then there is information about the possible joint venture Novatek and Gazprom surfaced.

The Arctic shelf has always been a zone of interest of state-owned companies, because they are legally owned licenses for the field. However, after the introduction of sanctions, it became very difficult to attract investment because of the cordon. Thus, Rosneft and ExxonMobil (USA) had to collapse the shelf joint ventures. And projects with the Eni company (Italy) were also frozen.

And then suddenly Mikhelson with his "samovar".

Together with Gazprom Neft, the Michelson company intends to create a joint venture with sites in the Kara Sea off the coast of Yamal. The licenses for these sites belong to Gazprom, but he is ready to give these "plots" to Gazprom Neft. The company will contribute them to the joint venture and receive a share of 51%, and Mikhelson will give a "cabbage" for the development of the project. And Novatek may become the first company to receive the golden key to the Arctic shelf.

Unlike Sechin, who freely disposes of Rosneft’s money, Mikhelson is the owner of a private company. And he needs to calculate every step. That is why Leonid Mikhelson did not enter the consortium of investors of the seaside shipyard Star. For that Michelson and flew from Putin.

It should be noted that at one time, the head of the Ministry of Industry and Trade Denis Manturov apparently spoke in a conflict with Michelson on the side of Sechin. About this wrote in detail "Ruspress". He supported the non-admission of tankers by Michelson, built in South Korea, to the Northern Sea Route. Mr. Manturov was supported by the President of the United Shipbuilding Corporation Alexey Rakhmanov. How else? Rakhmanov is also a Sechin man.

About this in detail told The Moscow Post in the investigation "Michelson ordered?"

Today, Michelson has 15 tankers built at South Korean shipyards. But new ships Novatek may be needed for further projects in the near future. But it seems that Michelson is able to do without Sechin.

The only question is not to fall into the trap ... Last time it was a basket with sausages, on which Minister Ulyukayev was led. What can the active brain of Mr. Sechin come up with this time in order to neutralize such a successful competitor, which is Leonid Michelson?