Putin woos Evans for Rosneft job

Kremlin seeks clout
of Bush confidant
before oil firm’s IPO
By GREGORY L. WHITE
Staff Reporter of THE WALL STREET JOURNAL
December 16, 2005

Russian President Vladimir Putin offered former U.S. Commerce Secretary Donald Evans a top job at Russian state oil company OAO Rosneft, highlighting the Kremlin’s desire to use Westerners to help legitimize its tightening grip over the energy sector.

Two people familiar with the conversation confirmed Mr. Putin made the unexpected offer at a Kremlin meeting last week with Mr. Evans, a confidant of U.S. President George W. Bush. Mr. Evans didn’t give an answer at the meeting, these people said, but is considering the offer. He is likely to decline what would probably be a largely ceremonial post at a company with a controversial history, these people said.

A Kremlin spokesman declined to comment. But Deputy Prime Minister Alexander Zhukov said at a news conference Thursday that the government would, in principle, welcome the participation of top Western executives in big local companies. “As for Evans, we’ll soon find out,” the Interfax news agency quoted him as saying.

A person taking calls for Mr. Evans on the matter said he wasn’t available for comment. She confirmed he met Mr. Putin but declined to comment on what was discussed.

The news comes just a week after Russian state gas giant OAO Gazprom named former German Prime Minister Gerhard Schroeder as chairman of a $5 billion Russian-controlled venture building a pipeline under the Baltic Sea to supply gas to Europe. That appointment sparked criticism of Mr. Schroeder, who while in office was a strong supporter of Mr. Putin and the pipeline project.

…

One of the challenges will be to persuade Western investors, many of whom saw the value of their holdings of Yukos decimated, to buy Rosneft. Yukos and its shareholders are still challenging the government breakup of the company and Rosneft’s acquisition of its core asset in Russian and foreign courts.

“We consider their ownership in that asset to be contested,” Yukos Chief Executive Officer Stephen Theede said in an interview last week. Rosneft has said it expects to acquire more Yukos assets.

The hiring of Mr. Evans, a veteran Texas oil man with a history of working with President Bush, would be a big boost for Rosneft’s efforts to portray itself as a world-class oil company. As commerce secretary, Mr. Evans developed a close relationship with Russian Economics Minister German Gref, one of the advocates of the Rosneft IPO.

One person close to the situation said the Kremlin invited Mr. Evans for the visit without disclosing what the real topic was. At the Kremlin meeting, “Putin just dropped it on him, said would you consider being the chairman or co-chairman of Rosneft,” this person said.

Mr. Putin insisted the offer be kept secret, but news leaked within days to a Russian newspaper.

Mr. Evans, who left Mr. Bush’s cabinet after the president’s first term, often said that he looked forward to spending more time in Midland, their West Texas hometown. In June, he became chief executive of the Washington-based Financial Services Forum, made up of the top executives of the nation’s 20 largest financial-services firms, while his family returned to Midland. He still splits his time between the two cities.

Rosneft’s rise to prominence has coincided with the naming of Igor Sechin, the powerful Kremlin deputy chief of staff and a longtime Putin friend, as chairman. Mr. Sechin, who Kremlin officials say doesn’t give interviews, was one of the main architects of the Kremlin’s attack on Yukos, according to several current and former officials.

….

The Bush administration has for several years sought to boost energy cooperation with the world’s No. 2 oil exporter. But while Mr. Bush has developed a warm personal relationship with Mr. Putin, the U.S. has made little headway in opening up Russia’s oil and gas resources as the Kremlin has steadily reasserted its control over the sector. Exxon, for example, was negotiating a deal to buy a large stake in Yukos right before the Kremlin arrested Mr. Khodorkovsky and slapped the company with billions in back-tax claims.

In recent months, the Kremlin has taken some steps to reassure foreign capitals and investors. Mr. Putin selected energy security as the main theme for the Group of Eight summit meeting to be held in St. Petersburg in June.

Heck, my congressman owns a Russian bank, which has traded off his position, regardless of the obvious ethical issues.

That’s hilarious. Do you really think that association with Republican party fundraisers is a sign of lack of corruption? It’s just a sign that you’re bribing the right people.

Ah, that would explain why rightwing bloggers kept bringing up Schroeder at random intervals a couple of days ago. It was surreal. Poor dears hadn’t gotten their talking-points straight and wound up sounding like bots.
.

Oh, I’m sure that they’ll be snotty – but about those Evul Libruls who dare to question the Free Market.

I’d been thinking of blogging this and took some notes earlier in the week when the WSJ remarked that Schroeder may find his “new comrades at Gazprom with views of the world that are compatible with his own”, i.e. a reference to Schroeder’s ex-commie board buddies. I imagine the WSJ isn’t being quite so snotty today regarding Evans – it’s clear that cronyism goes across the political spectrum.

This is a very troubling development but it’s symptomatic of German willingness to do just about anything to stay in with Putin. And it’s paying off – the Germans are now the only NATO member with a military base still in Uzbekistan, for example. And they’ve clearly just secured a very important future source of energy for themselves. Or at least the promise of it…

Oh I don’t know. Why did Halliburton hire Dick Cheney? It is clearly beneficial for a company such as Rosneft to have strong personal connections at the highest levels of the US government. Evans, who is very close to Bush, is about as well-connected as you can get. He also has a lot of experience in the oil and gas industry.

It looks like the Russians, careful observers of US politics, have learned how best to work with an administration and Republican machine that is based on cronyism, graft and and campaign money laundering. Evans was Bush’s campaign finance chairman in 2000, and was very good at it. Perhaps in his new position, if he takes it, he will figure out some way of turning Rosneft into a Republican cash cow.

As for the investors, it is more likely the scent of the right kind of corruption rather than the lack of corruption that is most attractive. Rosneft’s future profitably would surely be enhanced by having lots of buyable friends in Washington. For one thing, it is an insurance policy against future US military actions that might put Rosneft’s assets and relationships in jeopardy.

With a Bush involved? Hello? More likely the inverse: appearance of the correct corruption.

(This post is mostly an excuse to promulgate “oiligarghy” :)

Pretty much. And if they dont do what Czar Vladimir wants, they get fired.

Ian Whitchurch