MOSCOW, August 16 (RIA Novosti) United Russia fails Kremlin / Russia's Gazprom strengthens its position in UK gas market / Russia to become leader on market of regional planes / TNK-BP, Surgutneftegaz prepare infrastructure for Eastern oil pipeline

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Vedomosti

United Russia fails Kremlin

The pro-Kremlin party United Russia has a million members, but it has failed us, said Vladislav Surkov, deputy head of the Kremlin administration in charge of parties.
This means that an equally strong new player should emerge in mainstream politics, eventually to replace the current party of power.
Surkov started criticizing Russia's party system, which he helped form, in spring. "The biggest drawback of our political system is that it is leader-based and hence depends on one party," he told a meeting with the regional activists of the Russian Party of Life on March 24 (the transcript of the meeting was published yesterday). "There is no major alternative party, which makes the system unstable."
He said a political force to replace the currently dominant party should emerge in Russia in the next five years.
Conditions for a two-party system have been created. One of the two parties is United Russia (37% of the vote in the elections to the lower house of Russia's parliament), and the other "party" comprises the Liberal Democrats, Communists and the nationalist Rodina (Motherland) party, which together won 34%.
Surkov said these parties could be regarded as leftwing and patriotic, but could change with due regard for national "traditions, social democratic values and healthy patriotism."
He called on the Party of Life to take a foothold in that niche and to squeeze out the current players.
At the same time, Surkov said he hoped to cleanse "the party of the future" of the image of a "party of power". He said on March 24: "Beware of relying on administrative resource, which promises a political death."
United Russia has risen to its electoral ceiling, whereas a new party could embrace other groups of the electorate, said Dmitry Vinogradov, chief analyst with the Propaganda consulting company.
Olga Kryshtanovskaya, director of the Russian Institute of Applied Politics, also said that a new leftwing-centrist party would not rival but would become an "addition" to United Russia, stealing votes from the Communists. She said Surkov's speech at the March meeting was published to show officials and regional elites that the Kremlin has special plans for the Party of Life.

Gazeta.ru

Russia's Gazprom strengthens its position in UK gas market

Russian energy giant Gazprom, through its subsidiary ZMB Gasspeicher Holding GmbH, intends to gain access to Saltfleetby, an depleted British natural gas field, to convert it into an underground gas storage facility. If local authorities continue to shut the company out from their retail gas market, British companies in Russia may come up against problems.
A storage facility holding 700-750 million cubic meters is planned to be completed by 2008, with commercial operations set to begin in 2008-2009. Experts from Ray, Man & Gor Securities estimate the cost of the new facility at about $75-100 million, based on the cost of similar projects.
Stanislav Tsygankov, head of Gazprom's foreign trade department, said that such a facility "could give Gazprom a competitive edge against other sellers of the blue fuel" in Britain.
A gas industry analyst at the Natural Monopolies Research Institute, Ilya Solovyov, agrees with the top manager of the state-controlled company: "To achieve this objective, Gazprom has bought into the Interconnector pipeline supplying gas to the United Kingdom, made trial deliveries of liquefied gas to the British Isles, and acquired a small gas distribution company. Gazprom has a well-defined strategy for tapping the British market."
In February 2006, British authorities strongly opposed the Russian monopoly's intention to buy Centrica, a major gas distributor. But in April their attitude underwent a change: Alan Johnson, secretary of State for Trade and Industry, said the cabinet would not prevent the deal.
Such compliance can be explained by the interest big business in Britain is showing in operating freely in Russia. "If Gazprom is consistently stopped from entering the British market, U.K. companies in Russia may come up against certain difficulties. TNK-BP and its prospects for developing the Kovykta deposit may be affected, as well as Shell's participation in developing the Salym deposit [Western Siberia], and Sakhalin projects," said Solovyov.

Izvestia

Russia to become leader on market of regional planes

More Russian air carriers prefer to buy Boeing and Airbus planes because Russian aircraft makers do not have a technological edge over the two giants on the market of regional planes. However, Russia may get a hold on the market with a Sukhoi Superjet 100.
"Renewing the fleet is a life-or-death question for air carriers," said Andrei Yegorov, marketing director of the AiRUnion alliance of carriers. "Those who fail to acquire better planes will have to leave the market."
Aeroflot is choosing between the long-haul Boeing 787m Dreamliner and Airbus A350. Even regional carriers prefer to buy foreign planes despite a 40% customs duty.
But there is a niche where Russia may take a befitting place among weaker players. "Russian designs could become dominant in the segment of regional planes," said Viktor Subbotin, director general of Sukhoi Civil Aircraft.
The company is working on the Superjet 100 (SS100, formerly the Russian Regional Jet), a family of jet liners with a range of more than 3,000 kilometers (1,865 miles) seating 60, 75 and 95 passengers. The SS100 will not rival Boeing and Airbus, whose smallest planes seat 120, but will compete with Canada's Bombardier and Brazil's Embraer.
Subbotin said the market of regional planes would need about 5,700 aircraft until 2025 ($150 billion in monetary terms). Sukhoi Civil Aircraft intends to gain about 20% of this market.
"Our share is changing as the program is progressing," Subbotin said. "Initially, we hoped to sell about 800 planes, but our share should objectively grow to 1,000-1,100 now that Italy's Alenia Aeronautica has joined the project."
"There is a demand for such planes on the short-haul market," said Lev Koshlyakov, deputy director general of Aeroflot. "When the SS100 receives the requisite certificates and Aeroflot starts using it, demand for it may emerge in Europe and the Middle East."

Vremya Novostei

TNK-BP, Surgutneftegaz prepare infrastructure for Eastern oil pipeline

Anglo-Russian joint oil venture TNK-BP and Russia's Surgutneftegaz may begin the construction of a 100-km oil pipeline next year to link the Verkhnechonskoye (Irkutsk Region) and Talakanskoye (Amur Region) oil fields, to which they hold licenses, with the Eastern Siberia - Pacific Pipeline (ESP). The project's feasibility studies are expected to be completed by the end of the year.
Surgutneftegaz said the project already had the approval of environmental authorities. A pipeline of such a length would cost about $200 million, according to experts.
The initial capacity of the project has not yet been established, but experts say it may be 10 million metric tons (73.3 million barrels) a year. TNK-BP data indicates that by the time the ESP's first section goes on stream in late 2008, production at Verkhnechonskoye will reach 7 million tons a year. Surgutneftegaz said it was ready to provide 2 to 3 million tons a year in the early stages from its Talakanskoye deposit.
With the deposits brought up to planned production levels (Verkhnechonskoye to 10 million tons a year and Talakanskoye to 6 million tons), the capacity of the pipeline may be increased, according to experts.
In addition to TNK-BP and Surgutneftegaz, Rosneft may be also interested in the project. Troika Dialog analyst Valery Nesterov said the pipeline could transport crude from the Vankorskoye field in the Krasnoyarsk Territory (scheduled to begin operations in 2008). "In early stages, Vankorskoye may deliver 19 million tons per year," he said.
Rosneft, which owns almost 26% of Verkhnechonskneftegaz, is considering an alternative link-up with the ESP.
Within reach of the pipeline, Nesterov said, are also Yukos deposits, notably the Yurubchensky deposits. He said whoever buys Yukos assets after its bankruptcy might link up to the pipeline.