Oil sticks to the hands

Transneft wants to continue to enrich itself at the expense of others.
Origin source
For the Russian fuel market, the new year has started with a judicial confrontation between the two largest companies. The giant of world oil production, Rosneft, was forced to appeal to the court against Transneft, asking to force the latter company to pump oil. Over the recent years, Transneft, headed by Nikolay Tokarev, has more than once appeared in the center of scandals. 

But this time, as observers believe, Nikolay Tokarev has gone absolutely beyond reasonable limits, endangering the state budget. The essence of the dispute is simple. Transneft is known to be the world's largest pipeline company, engaged in crude oil pumping. 93% of Russian oil transported through the pipes of Transneft. With such volumes the company actually has a monopoly: whoever you may be, but if you want to extract oil and sell it, you have to go and enter into a contract with Nikolay Tokarev. On conditions he will offer you. Else you can sit in taiga near the drilling platform. 

What was yours, now is ours

When somebody else's fate depends solely upon you will, it is difficult to maintain the soundness of mind. Nikolay Tokarev, it seems, has started to have delusional dreams of grandeur. Suffice it to recall the dispute over the size of dividends on preferred shares of Transneft: shareholders were confident that they had been simply cheated with dramatically lesser payments. And that decision didn't affect only the interests of individual shareholders. Alas, Transneft is too big a player in the market, and therefore any company's action can not remain unnoticed. No wonder, Deutsche Bank explicitly stated in a letter sent to the Russian government: the policy of Transneft in principle makes investors wonder if it is really a good idea to deal with Russia. 

But back to the situation with the pumping of oil. Realizing that the oil producing companies have nowhere else to go, Transneft set a condition: a part of transported oil shall be its property. Why all of a sudden? On this account the monopoly gave its own explanation: during transportation the so-called excess oil remains in the pipelines. Who it should be returned to is unclear, since the oil in the pipeline is drained from different companies. And if so, unidentified oil shall be kept by Transneft.

Naturally, the partners of Transneft, to put it mildly, are not very happy with that approach, because the losses may reach tens of millions of rubles. As the committee member of the Chamber of Commerce of the Russian Federation on Energy Strategy and Energy Development, Rustam Tankan, wrote in his article at Lenta.ru: "Simple calculation shows that it is about one million tons of just oil annually. And there are also oil pdoruct. About 50 thousand tons, making it about a thousand dollars per ton! It turns out, it turns out ... In general, about as much oil as consumed by several large federal customers. Note that in this case Transneft saves not only on extraction, but also on processing. Amazing, mind it, efficiency."

It is hard to disagree with the expert's conclusion. In fact, without investing a ruble in the exploration and development of mineral deposits, the company of Nikolay Tokarev becomes the owner of a large volume of oil, which can then sell at a profit. Zero effort and a lot of money!

Budget under threat

In fact, as noted by Rustam Tankan, this practice began to emerge only in our time. In the Soviet era oil residues always returned to the respective companies, as it was logically concluded that you can not take someone else's. Why would the oil companies be silent about that tyranny now? Because, as already mentioned, Transneft has a monopoly, and to argue with it won't lead anywhere. However, someone had to break this conspiracy of silence. Patience was exhausted in Rosneft, which is the eve of the conclusion of the agreement on oil transportation for 2017 proposed to discuss the validity of the formula for calculating oil residues. But Nikolay Tokarev, apparently, wouldn't bend: nobody would like to lose the source of free money.

As a result, there is a real danger that from 1 January of this year monopoly will simply cease to pump oil, which Rosneft sells abroad. Such a move would lead to a virtually stop of operation of the largest domestic oil producer. Firstly, it would be necessary to stop the development of the majority of deposits, since the available tanks cannot provide for oil storage in excess of 72 hours. Secondly, as emphasized in the ruling of the court, "production stoppage will entail irreparable significant property damage both to the company and its employees, and the state (forgone taxes, fees, dividends, and so on.), and third parties as a result of acute shortage in the oil market and mineral oil. "

In such a situation the most suitable definition for Transneft's actions may be a simple and clear word: blackmail. Because of that, in the last days of December, Rosneft appealed to the Moscow Arbitration Court, demanding to impose interim measures to preserve the status quo in its relations with the monopoly. As a result, the court in its decision prohibited Transneft to stop the transportation of Rosneft's oil or reduce its volume from January 1, 2017. Thus, the dispute is solve and justice is done? Certainly not: Transneft continues to believe that its act are in accordance with law. And Nikolay Tokarev delivered an emotional tirade, declaring that the judges decided in favor of Rosneft under pressure, and the chairman of the Supreme Court Vyacheslav Lebedev is to deal with them.

Frankly, to throw such statements without real facts accusing the court of impropriety, suits some petty pickpocket, and not the head of a large state-owned corporation. However, when money flows out of your hands, you may become emotional. "Nikolay Tokarev's dissatisfaction is possible to understand: a specific source of enrichment at the expense of his partners is disappearing," commented Alexey Mukhin from Nezavisimaya Gazeta.

State, is it "him"?

How to resolve the conflict is still unknown; Transneft has already appealed against the decision of the Arbitration Court of Moscow in a higher court. However, this situation is much more important in another aspect that becomes obvious if we discard all the extra husks. Both Rosneft and Transneft are state companies, and therefore, are required to work in the public interest. The State now urgently needs money, and sale of crude oil is one of the main ways of filling the treasury. That's why a situation where one state-owned company directly hampers the actions of another company, which are aimed to help the founder-state to fill the budget, should be seen as something deeply flawed. Probably more 50 years ago, such behavior would be called sabotage. Today, I think, it would be better to call it self-interest, which could have become an end in itself.