2004 Schedule D 1 Form

Posted onDecember 02, 2011 - 10:47 pm by Admin | 0 Comments

Gazprom is classified as a publicly traded developer, refiner, and transporter of natural gas and oil, with additional energy generation facilities. However, Gazprom’s majority ownership and its board of directors suggest this gas giant is really a state-owned monopoly. This form of state-sponsored capitalism results in a public company with a majority ownership (in excess of 50%) held by the Government of the Russian Federation.

Gazprom’s Public Character

Gazprom and its subsidiaries, including OAO Gazprom operate under capitalistic principles and serve investors with a variety of share options, listed on the Russian Federation Ministry of Finance. U.S. investors can purchase three American Depositary Receipt (ADR) offerings, traded on the (Pink sheets) Other OTC Issues Exchange.

  • Gazprom OAO (ADR)(Public, PINK:OGZPY).
  • RAO GAZPROM (Public, PINK:RGZPF).
  • JSC Gazprom Neft (ADR)(Public, PINK:GZPFY).

Capitalist or Monopolist?

Although Gazprom operates as a publicly traded business enterprise, at its core it is a state-owned monopoly. Of the 11-member board of directors, five are current government officials:

  • Viktor Subkov, First Deputy Prime Minister of the Russian Federation, and Chairman of the Gazprom Board of Directors.
  • Alexey Borisovich Miller, Deputy Chairman of Gazprom's Board of Directors, Chairman of Gazprom's Management Committee, and Deputy Energy Minister of the Russian Federation.
  • Elvira Nabiullina, Economic Development Minister of the Russian Federation.
  • Sergey Shmatko, Energy Minister of the Russian Federation.
  • Igor Yusufov, Special Envoy of the RF President for International Energy Cooperation and Ambassador at Large of the RF Ministry of Foreign Affairs, and Energy Minister of the Russian Federation.

Board Members with Former Governmental Service

Two more board members are former government officials, including:

  • Farit Gazizullin, who served as First Deputy Chairman of the State Property Committee, First Deputy State Property Minister, Russian Federation from 1996–1997; State Property Minister of the Russian Federation from 1997–2000; and Property Relations Minister of the Russian Federation from 2000–2004.
  • Elena Karpel, who served as Deputy Chairman, First Deputy Chairman of the Pricing Committee of the Russian Federation Ministry of Economy from 1991-1992, and First Deputy Chairman of the Russian Federation Pricing Policy Committee from 1992–1994.

Nationalistic self-interest is likely driving the dual loyalties of government service and capitalistic management, calling into question the motivation of corporate decisions.

Gazprom and the European Union Market

Gazprom transports its product through both its own pipelines and those of other countries, to supply European Union-member countries with oil and gas. Russia supplies the EU with 40% of gas imports and 33% of oil imports. Significant amounts are shipped through Ukrainian pipelines. The relationship between Gazprom and some of its pipeline transit providers has been contentious, causing European Union concern over the reliability of OAO Gazprom service.

Disputes Between Gazprom and Ukraine

On January 1, 2009, as the result of a dispute between Gazprom and Naftohaz Ukrainy, a national joint-stock company operating the state-owned Ukrainian pipeline, supplies of natural gas were shut off until a resolution was reached twelve days later, on January 13, 2009. During this period, Ukraine accused Gazprom of refusing to ship its product and Gazprom accused Ukraine of voluntarily shutting down three of its transportation pipelines.


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