Russia 111206

Basic Political Developments Russian-Japanese nuclear energy agreement ratified - The lower house of the

Japanese Parliament has ratified an agreement on cooperation with Russia in the area of the use of nuclear energy for peaceful purposes.

South Ossetia's Border with Russia Temporarily Shut Down To Prevent Provocations – Source

Russian deputy premier, Spanish acting premier discuss fin crisis - Russia’s Deputy Prime Minister Alexander Zhukov and Spain’s Acting Prime Minister Jose Luis Rodriguez Zapatero had a meeting here Monday in the format of the official functions that culminated the Year of Russia in Spain and the simultaneous Year of Spain in Russia.

o Spain's queen, Russia's 1st lady inaugurate Russian center in Madrid Russian president arrives in Prague - Russian President Dmitry Medvedev arrives

in Prague at 19:00 on Wednesday and he will meet his Czech counterpart Vaclav Klaus on the same day in the evening, the Presidential Office's press section said yesterday.

o Russian, Polish General Staff chiefs to exchange missile defense views Lieberman to talk to Russians about arms to Syria - From Vilnius, Lieberman will

travel to Moscow on Thursday for a joint Russian- Israeli economic meeting, during which he will meet with Russian Deputy Prime Minister Viktor Zubkov.

Russia warns against contacts with Taliban - “According to information we have, both the Afghan authorities and a number of their international partners had sporadic contacts with members of the Taliban movement. Moreover, Kabul was not always notified of these meetings,” Russian presidential representative for Afghanistan Zamir Kabulov said in an interview with Interfax.

Russia abstains in UNSC vote on sanctions against Eritrea Russian naval ships set out for Atlantic, Mediterranean - The heavy Russian

aircraft-carrying cruiser Admiral Kuznetsov and the large antisubmarine ship Admiral Chabanenko are setting out for the Atlantic and the Mediterranean on a two-month cruise. The ships will also call at the Syrian port of Tartus, which is a Russian naval maintenance and supply centre.

Pacific Fleet warships lead 6th civil convoy through Gulf of Aden Russia's humanitarian centre in Serbia will be officially opened in March or April

2012o Russia fostering trade with Serbia - This year's trade between Serbia and

Russia amounted to EUR 3 billion, Serbian Deputy Prime Minister Ivica Dacic said in Moscow Monday.

DUMA ELECTIONS o U.S. worried by reports of electoral violations in Russia o McCain warns Putin of approaching “Arab Spring” - U.S. senator John

McCain, known for his staunch criticism of Russia, warned Prime Minister Vladimir Putin that Russia would see an “Arab Spring” of its own, following the post-election street protests.

o Hugo Chavez congratulates Russian leaders on occasion of Duma electiono Azerbaijan, Russia Presidents hold phone conversationo CEC chairman: Official results of State Duma election to be announced

before Saturdayo Moscow election protesters remain in custody - Most of the 300 protesters

detained on Monday at a demonstration in downtown Moscow against alleged electoral fraud remain in custody as of Monday morning, police said.

o Russia's ruling party faces fraud allegations - "There were unprecedented violations in this election," said Lazareva, 60. "I have been on the commission since 1990 and I've seen a lot, but I have never see such blatant misconduct."

o RUSSIA VOTES: Putin and Russia are the winners in this election - And the elections have set a precedent: by allowing a more-or-less free vote this time round, the Kremlin will find it harder to blatantly fix any elections in the future.

o As Putin Forces Hold On To Power, Evidence Mounts Of Pre-Election Press Crackdown

o Investors Upbeat About New Duma o Power carve-up in Duma after ruling party’s poll slump

Russia downgrades ties with Qatar after attack on Russian diplomatso Russian ambassador to leave Qataro Qatar vs Russia: When size does not matter - Russia is downgrading its

relations with Qatar following an attack on its envoy in Doha. The assault is being linked to Moscow's criticism of Qatar's backing for the US position on the unrest in Syria.

Russian icebreaking tanker set to deliver fuel to Alaska town SK to investigate lawfulness of children foreign adoption

o SK opens criminal case over RF adopted son murder in US Russian president Special Deputy Vladimir Rushaylo arrives in Kyrgyzstan Official says labor migrants will have to learn Russian language Double terrorist attack in Dagestan

o Four people were injured in explosions in Dagestan Dagestani Brothers Jailed in Terror Case - The Kuzminsky District Court ruled

that Sultan and Sadir Abdulkerimov knew Zeinab Suyunova’s plans to execute a suicide attack on Red Square on New Year’s Eve last year and offered her shelter, rather than inform police.

Eight coaches carrying coal go off track at Baikal-Amur Railway Rosoboronexport: airplanes, helicopters and Russian technology at "LIMA 2011"-

The exhibition will be held at Langkawi, Malaysia, between 6th and 10th this month

Moscow press review for December 6, 2011 Russian Press at a Glance, Tuesday, November 6, 2011 Kremlin Is Seen Spending More After Setback - In particular, Mr. Putin could

push for targeted spending at state corporations. "The best way to address his fears of losing control will be to rely on a direct state presence in the economy,"

said Natalia Orlova, chief economist at Alfa Bank. "He'll be looking to secure his position economically."

NATO and Russia Can Defend Together - By ANDERS FOGH RASMUSSEN Flour and machine guns don’t count - The West holds Russia in Afghan

“reception area” Evgeny Shestakov (Bonn)

National Economic Trends Acting min: Russia’s 2011 budget surplus may exceed 0.5% of GDP Ruble slumps in MICEX trade on S&P warning of eurozone downgrade Finance Ministry projects higher capital outflow -       "The global economy is

slowing down, so the capital outflow will be substantial and could come in, according to our estimates, at $80bn or even top $85bn," he said, adding that such results would have a negative impact on Russia's economy. Earlier, the Central Bank of Russia had announced that capital outflow stood at $64bn in 10M 2011.

Fitch confirms Russia’s BBB ratingo Poll results will not affect Russia's rating - Fitch

Business, Energy or Environmental regulations or discussions RTS Futures Fall on Europe as Mechel Advances: Russia Overnight Russia to reduce power equipment import duties under WTO obligations MICEX-RTS to liberalize forex market Merged Bourse Mulls Future Uranium One sets terms for Russian bond offer MRSK London Listing for Future Fund Raising Yandex to go international Citigroup Bemoans Liquidity Sberbank Bids for National Mail.ru Moving to Tower Strabag Q3 Up 3%

Activity in the Oil and Gas sector (including regulatory) Rosneft board of directors to consider increasing capital in JV with CNPC U.S. demand for Russian ESPO crude falls in Nov. Alliance Oil Company May Get Russian Tax Break, Kommersant Says

o Alliance Oil to request tax discounts under 60/66 system TNK-BP Wants More in Vietnam Russian Oil Frontier: Nowhere Land - Energy Firms, in Remotest Siberia for

Crude, Run Rigs Over Video Link From 700 Miles Away

Gazprom Gazprom says Ukraine can now pay for supplies in roubles Gazprom CEO: Ukraine and Russia will probably seal natgas deal in 2011

o Ukraine says to conclude Russia gas talks in Dec Gazprom fails to sign gas agreement with Moldova --- marginally negative Gazprom names special overseer for relations with Brussels Russia in WTO: Gas Dispute In Europe Could Find New Venue

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Full Text Articles

Basic Political Developments

Russian-Japanese nuclear energy agreement ratifiedhttp://english.ruvr.ru/2011/12/06/61636458.html

Dec 6, 2011 10:48 Moscow Time

The lower house of the Japanese Parliament has ratified an agreement on cooperation with Russia in the area of the use of nuclear energy for peaceful purposes.

The agreement, supported both by the ruling Democratic Party and the opposition Liberal Democratic Party, provides for reprocessing the spent nuclear fuel from Japanese nuclear power plants in Russia to extract uranium for the production of new fuel.

The agreement will also pave the way for promoting business ties.

The Russian-Japanese agreement in question will remain in effect for 25 years and can be automatically prolonged upon expiration.

(TASS)

12/06 12:29   South Ossetia's Border with Russia Temporarily Shut Down To Prevent Provocations – Sourcehttp://www.interfax.com/news.asp

http://www.interfax.ru/news.asp?id=220366GOOGLE TRANSLATION

South Ossetian authorities have temporarily closed the border with RussiaDecember 6, 2011 12:31

Tshinval.6 December. INTERFAX.RU - The border of South Ossetia with Russia temporarily shut down."This is in connection with the political situation in the republic and to prevent any kind of provocation. This measure is temporary in nature, and citizens, traveling across the border should temporarily refrain from traveling," - law enforcement bodies of the republic told Interfax.

08:41 06/12/2011ALL NEWS

Russian deputy premier, Spanish acting premier discuss fin crisis

http://www.itar-tass.com/en/c154/290170.html

MADRID, December 6 (Itar-Tass) — Russia’s Deputy Prime Minister Alexander Zhukov and Spain’s Acting Prime Minister Jose Luis Rodriguez Zapatero had a meeting here Monday in the format of the official functions that culminated the Year of Russia in Spain and the simultaneous Year of Spain in Russia.

The two men gave special focus at the talks to the ongoing financial crisis in Europe and the ways out of it.

Zhukov and Zapatero summed up the results of the past twelve months, pointing out the powerful impulse that has been given to a further progress of bilateral relations.

More than 350 events in the political, economic and cultural spheres have been held. One of the last such events was Monday’s business forum that drew enough attention from both countries’ business communities.

The reciprocal Year of Russian and Spanish cultures and social events was crowned with Monday night's gala concert of the stars of Russian ballet in the Royal Opera House in Madrid. The list of dignitaries who attended it included King Juan Carlos, Queen Sofia, Russian President Dmitry Medvedev’s spouse Svetlana, and Alexander Zhukov.

Spain's queen, Russia's 1st lady inaugurate Russian center in Madrid

Published December 05, 2011

EFE

Read more: http://latino.foxnews.com/latino/politics/2011/12/05/spains-queen-russias-1st-lady-inaugurate-russian-center-in-madrid/#ixzz1fjDTmaIo

Madrid –  Spain's Queen Sofia and the wife of Russia's president inaugurated here Monday the new Russian Science and Culture Center.

The opening of this center officially closes the Spain-Russia Dual Year, dedicated to promoting and strengthening throughout 2011 the economic, political, cultural and scientific ties between Russia and Spain.

After having lunch together, Sofia and Svetlana Medvedeva arrived in the same auto for the inauguration of the new cultural showcase, where the queen was received with traditional Russian folk dancing and was treated to some typical Russian pastry.

During their tour of the installations they visited a small auditorium where several musical compositions were performed.

The 2011 Spain-Russia Dual Year will close with a gala performance of Russian ballet at Madrid's Royal Theater, to be presided over by King Juan Carlos and Queen Sofia and attended by the Russian first lady and her country's deputy prime minister, Alexander Zhukov.

Also present will be other Spanish officials, including Foreign Minister Trinidad Jimenez and Madrid's mayor, Alberto Ruiz-Gallardon.

Read more: http://latino.foxnews.com/latino/politics/2011/12/05/spains-queen-russias-1st-lady-inaugurate-russian-center-in-madrid/#ixzz1fjDXygP6

Russian president arrives in Praguehttp://praguemonitor.com/2011/12/06/russian-president-arrives-prague

ČTK | 6 December 2011

Prague, Dec 5 (CTK) - Russian President Dmitry Medvedev arrives in Prague at 19:00 on Wednesday and he will meet his Czech counterpart Vaclav Klaus on the same day in the evening, the Presidential Office's press section said yesterday.

All important events in Medvedev's programme will take place at Prague Castle, the presidential seat, on Thursday.

According to the information available to CTK, Medvedev and his wife will probably stay in the Four Seasons hotel in Prague.

Medvedev and Klaus will then sign a number of Czech-Russian contracts, mostly relating to cooperation in transport, the military and culture.

There will be a framework contract on the construction of railways in the Urals. Under one of the biggest contracts of the past years, Czech firms, headed by OHL ZS, are to build about 350 kilometres of railways for almost 40 billion crowns.

The Transport Ministry and Russian representatives will sign an addendum to the contract on the repairs of helicopters thanks to which the state-owned Letecke opravny Malesice (LOM) aviation repair works is to repair and modernise Russian transport helicopters not only for the Czech military, but for the armed forces of other countries, too.

The University of Economics in Prague and the Moscow City University are also to sign an agreement on joint bachelorship studies that will be taught in Moscow.

Medvedev will have talks with Klaus on Thursday morning, he will open the exhibition of Kremlin collections in the afternoon and then he is to meet Prime Minister Petr Necas, chairman of the senior government Civic Democrats (ODS).

The Russian presidential couple is to leave Prague at 17:40 on Thursday, according to the programme, released by the Czech Presidential Office's press section.

From the Prague-Ruzyne airport, Medvedev and his wife Svetlana will go directly to the Strahov Monastery in Hradcany, near Prague Castle, where the Czech presidential couple will welcome them. They will have a joint dinner.

Thursday's programme of Medvedev opens with a welcome ceremony at Prague Castle at 10:00, followed by a private meeting of the Russian and Czech presidential couples and talks of the national delegations.

Klaus and Medvedev should sign prepared bilateral agreements.

Klaus will then invite Medvedev to a luncheon in the Rudolph Gallery at Prague Castle.

In the afternoon, Medvedev will open a unique exhibition on "The Tzar's Court under the Romanov Dynasty" that will offer a selection of valuable items from Moscow's Kremlin collections.

Before he leaves the Czech Republic, Medvedev is to meet Necas at Prague Castle.

Medvedev will arrive in Prague at Klaus's invitation. He is the first Russian head of state to visit the Czech Republic twice.

Medvedev attended the Russia-U.S. summit in Prague last year when he and U.S. President Barack Obama signed a new U.S.-Russian nuclear arms reduction treaty.

Medvedev and Klaus stressed last year that they expected their countries' business cooperation, subdued by the economic crisis, to increase again.

The tender for the completion of the nuclear power plant in Temelin, south Bohemia, in which Russian Atomstroyexport is interested, is high on the two countries' agenda. U.S. Westinghouse and the French Areva and also interested in the giant order.

The United Russia party of PM Vladimir Putin and Medvedev won a narrow majority in the weekend's general elections in Russia, but its position in parliament has considerably weakened.

($1=18.647 crowns)

Copyright 2011 by the Czech News Agency (ČTK). All rights reserved.Copying, dissemination or other publication of this article or parts thereof without the prior written consent of ČTK is expressly forbidden. The Prague Daily Monitor and Monitor CE are not responsible for its content.

12/06 12:23   Russian, Polish General Staff chiefs to exchange missile defense viewshttp://www.interfax.com/news.asp

Lieberman to talk to Russians about arms to Syria http://www.jpost.com/DiplomacyAndPolitics/Article.aspx?id=248278

By HERB KEINON 12/06/2011 04:01

Foreign minister to bring up issue of Russian ship-killing missiles sale to Syria with Russian officials in Lithuania. Foreign Minister Avigdor Lieberman is expected to discuss Russia’s recent delivery of ship-killing missiles to Syria during high level meetings this week with Russian officials in Lithuania and Russia.

According to an Interfax report last week, Russia recently delivered Yaknot cruise missiles it sold to Damascus in 2007. Both Israel and the US had intensively lobbied against the sale, and then against the delivery.Under the deal, worth a reported $300 million, Russia was believed to be contracted to deliver 72 missiles, which it said will protect Syria’s coast from possible attack.

Israel expressed concern in the past that these missiles would fall into Hezbollah’s hands.The delivery of the missiles to Moscow’s traditional ally in the Middle East comes in defiance of Western calls for an arms embargo against Syria because of the continuing violence there.

Lieberman is expected to meet Russian Foreign Minister Sergei Lavrov on the sidelines of a conference of the Organization for Security and Cooperation in Europe that opened

Sunday night in Vilnius. In addition to Lavrov, Lieberman is scheduled to meet the foreign ministers of 13 countries, including Britain, Sweden, the Netherlands, Azerbaijan and Mongolia.

From Vilnius, Lieberman will travel to Moscow on Thursday for a joint Russian- Israeli economic meeting, during which he will meet with Russian Deputy Prime Minister Viktor Zubkov.

Russia warns against contacts with Talibanhttp://pakobserver.net/detailnews.asp?id=128728

Moscow—Russia has warned all countries involved in the settlement efforts in Afghanistan against secret contacts with the Taliban, the Russian Interfax news agency has reported.

“According to information we have, both the Afghan authorities and a number of their international partners had sporadic contacts with members of the Taliban movement. Moreover, Kabul was not always notified of these meetings,” Russian presidential representative for Afghanistan Zamir Kabulov said in an interview with Interfax.

“Such behind-the-scenes contacts between representatives of foreign states and organizations with the Taliban are fraught with wrong signals of the international community’s true intentions in the context of the settlement efforts on Afghanistan,” he said.

Russia is convinced that dialogue with the armed opposition could have a positive effect for normalizing the situation in Afghanistan only if militants lay down their arms, recognize the constitution and break away from al-Qaida and other extremist organizations, he said.

On the other hand, Russia has repeatedly supported proposals on removing Taliban officials from the UN Security Council sanction list, Kabulov said.

“In addition, we have also supported the proposal on separating the sanction regime imposed by UN Security Council resolution 1267 into two independent mechanisms, with the establishment of new Security Council committees separately on al-Qaida and on the Taliban,” he said.

“At the same time we suppose that reciprocal reconciliatory steps on the Taliban part should be a precondition for further actions on relieving the sanctions for the Taliban members on the list,” he said.—Online

Russia abstains in UNSC vote on sanctions against Eritrea http://english.ruvr.ru/2011/12/06/61632804.html

Dec 6, 2011 09:49 Moscow Time

Russia has abstained in a UN Security Council vote on sanctions against Eritrea since it sees as unproved Eritrea’s involvement in the so-called planned terrorist attack in Addis Ababa during the African Union summit there in January 2011. 

This came in a statement by the Russian Ambassador to the United Nations Vitaly Churkin.

Shortly before his address, the Security Council adopted a resolution by a majority vote to slap sanctions on Eritrea on charges of support for armed groups, including Ash-Shaab.

The groups are hindering efforts to secure reconciliation in Somalia.

China, too, abstained during the vote.

(TASS)

Russian naval ships set out for Atlantic, Mediterraneanhttp://english.ruvr.ru/2011/12/06/61635819.html

Dec 6, 2011 10:39 Moscow Time

The heavy Russian aircraft-carrying cruiser Admiral Kuznetsov and the large antisubmarine ship Admiral Chabanenko are setting out for the Atlantic and the Mediterranean on a two-month cruise. The ships will also call at the Syrian port of Tartus, which is a Russian naval maintenance and supply centre. The Russian Defence Ministry said earlier that the visit had been planned way ahead of the aggravation of the situation in Syria, so a decision was made not to cancel the visit. When at the Tartus port, the Russian ships will be refuelled, and will replenish their food and water reserves. The aircraft-carrier is due to return to its Northern Fleet base in early February next year.

(IF)

09:49 06/12/2011ALL NEWS

Pacific Fleet warships lead 6th civil convoy through Gulf of Aden

http://www.itar-tass.com/en/c154/290221.html

VLADIVOSTOK, December 6 (Itar-Tass) —— The Pacific Fleet warships are leading the sixth convoy of civil ships from various countries – Russia, Liberia, Hong Kong, Norway, India and Italy through the Gulf of Aden on Wednesday. The big anti-submarine ship Admiral Panteleyev, the tanker Boris Botuma and the rescue tugboat Fotiy Krylov protect civil ships from the pirates, the information support group of the press service of the Eastern Military District in the Pacific Fleet reported.

The Boris Butoma tanker visited the Salalah port, where she will replenish the stocks of water, fuel and food for the ships. In the second half of December the Admiral Panteleyev will visit the port of Victoria, the capital of the republic of the Seychelles.

The Pacific Fleet convoy set off from Vladivostok to the Gulf of Aden to participate in an international anti-piracy operation on August 29. During the voyage to the Horn of Africa Russian warships made a courtesy visit to the Cambodian port of Sihanoukville. The visit is timed to the 55th anniversary of diplomatic relations between Russia and Cambodia.

Since 2009 this is already the sixth convoy of the Pacific Fleet, which participates in an international anti-piracy operation. Last April the big anti-submarine ship Admiral Vinogradov, the sea tugboat SB-522 and the tanker Pechenga were on combat duty in the Gulf of Aden. The Pacific Fleet convoy was on a combat mission in the Gulf of Aden from December 22, 2010 until April 17, 2011. For this period of time Russian warships have led 14 convoys with merchant ships from various countries through the security corridor.

The Admiral Panteleyev crew has the experience of the struggle against pirates. In 2009 the warship was included in the second Pacific Fleet convoy, which was on duty off Africa. Together with the tanker Izhora and the sea tugboat MB-37 the ship was on combat duty for two months and led six convoys with more than 30 ships under the flags of various countries. The Pacific Fleet warships detained 29 pirates for this period of time.

Russia's humanitarian centre in Serbia will be officially opened in March or April 2012http://www.balkans.com/open-news.php?uniquenumber=128702

Balkans Business News Correspondent - 06.12.2011

Serbia's First Deputy Prime Minister and Minister of the Interior Ivica Dacic said in Moscow that the Serbian-Russian humanitarian centre in Nis will most likely be officially opened in March or April 2012.

Dacic, who is on a working visit to Russia, said following a meeting with Russian Minister for Emergency Situations of the Russian Federation Sergei Shoigu, who is also co-chairman of the Inter-governmental Committee for Trade, Economic and Scientific-Technical Cooperation between Russia and Serbia, that the centre will respond in emergency situations in Europe and beyond.

Source: Serbian Government

Russia fostering trade with Serbiahttp://www.emg.rs/en/news/serbia/170259.html

06. December 2011. | 07:04

Source: Tanjug

This year's trade between Serbia and Russia amounted to EUR 3 billion, Serbian Deputy Prime Minister Ivica Dacic said in Moscow Monday.

This year's trade between Serbia and Russia amounted to EUR 3 billion, Serbian Deputy Prime Minister Ivica Dacic said in Moscow Monday.

Petroleum Industry of Serbia (NIS) revenues make up 13 percent of the Serbian budget, preparations for the South Stream project are nearing completion and Russian customs got instructions to implement the free trade arrangement (FTA) with Serbia, he added.

Dacic said it was important that “the Russian customs have already received instructions to fully implement the trade liberalization agreement” between Serbia and Russia.

The agreement provides for free trade in 96 percent of all goods, Dacic said, adding that Serbia is the first country to have concluded such an agreement with Russia.“On the whole, we agreed that our business cooperation is very good and we wish our trade volume to reach EUR 4 billion, as it used to be before the crisis began,” Dacic said.

DUMA ELECTIONS

U.S. worried by reports of electoral violations in Russiahttp://en.rian.ru/world/20111206/169378734.html

01:53 06/12/2011

WASHINGTON, December 6 (RIA Novosti)

The U.S. administration is worried about reports of electoral violations during the December 4 parliamentary elections in Russia, a White House spokesman said.

International observers from the Council of Europe and the Organization for Security and Co-operation in Europe reported "flagrant procedural violations," including cases of ballot-stuffing.

"We have serious concerns about the conduct of those December 4th parliamentary elections," Jay Carney said.

U.S. officials said they were concerned by estimates given by European monitors from ODIHR, PACE and OSCE. U.S. Secretary of State Hillary Clinton expressed her concern about the election process earlier in the day.

"These concerns are reflected in the preliminary report issued by the OSCE's Election Observation Mission, including a lack of fairness in the process, attempts to stuff ballot boxes, and the manipulation of voter lists among other things," the White House spokesman said.

Sunday's elections were marred by widespread allegations of poll procedure in favor of United Russia, with dozens of clips appearing to show election fraud uploaded onto the Internet.

OSCE observers noted that the preparations for the elections were technically "well-administered across a vast territory," but marked by "a convergence of the state and the governing party," limited political competition and a lack of fairness.

The contest was slanted in favor of the ruling party: the election administration lacked independence, most media were partial and state authorities interfered unduly at different levels, OSCE said.

"Equally concerning are reports that independent Russian election observation efforts, including the nationwide Golos network and independent media outlets encountered harassment of their personnel and cyberattacks on their websites," Carney added.

U.S. Department of State Deputy Spokesperson Mark Toner said his country would provide greater support to non-governmental organizations in Russia for greater

transparency of the March 4 presidential elections. Over $9 million were allocated from the Department of State budget for the purpose.

"We have, I know, spent more than $9 million to support free and transparent processes for Russia's upcoming elections," Toner said.

"Our interest is to support these NGOs that support the process, not necessarily to support... any given political party," he went on. "And Golos, by the way, is just one of many nongovernmental organizations in Russia that receive this kind of assistance."

The polls saw the ruling United Russia party suffer its worst ever nationwide result. While the party of Prime Minster Vladimir Putin and President Dmitry Medvedev managed to hold onto a simple parliamentary majority, its share of the vote slumped from 64% to just under 50%.

McCain warns Putin of approaching “Arab Spring”http://en.rian.ru/russia/20111206/169389247.html

09:56 06/12/2011

WASHINGTON, December 6 (RIA Novosti)

U.S. senator John McCain, known for his staunch criticism of Russia, warned Prime Minister Vladimir Putin that Russia would see an “Arab Spring” of its own, following the post-election street protests.

“Dear Vlad (Vladimir Putin), The ArabSpring is coming to a neighborhood near you,” McCain said in his Twitter micro blog.

The senator added a link from his Twitter comment to a Wall Street Journal article which states that “widespread evidence of voter fraud” will sour Russia’s relations with Western capitals “in the coming days.”

Known for his sharp anti-Russian views, McCain has repeatedly called on the U.S. administration to treat Russia with caution.

Recently, he said that Russia had continued to "occupy a part of Georgia’s sovereign territory," in a comment about the annulment of election results in South Ossetia.

“As the Russian people go to the polls this week and again next year, we must continue to support their human rights and democratic aspirations as well, even though the electoral process in Russia will likely be just as manipulated by the Russian authorities as that of their client state, South Ossetia,” the senator said last week.

Sunday's parliamentary elections were marred by widespread allegations of poll procedure being manipulated in favor of the ruling United Russia party, with dozens of amateur video clips appearing to show election fraud uploaded onto the Internet and thousands of people protesting against unfair polls.

06:34 06/12/2011ALL NEWS

Hugo Chavez congratulates Russian leaders on occasion of Duma election.

http://www.itar-tass.com/en/c154/290133.html

CARACAS, December 6 (Itar-Tass) – Venezuela’s President Hugo Chavez has congratulated the people and government of the Russian Federation on the occasion of elections to the State Duma, the lower house of parliament, where the United Russia Party received a majority of seats on the background of high turnout of the voters at polling stations.

The full text of Chavez’s address was released by the Agencia Venezolana de Noticias /AVN/.

“Commandante Hugo Chavez warmly greets the President of the Russian Federation, Dmitry Medvedev, and Prime Minister Vladimir Putin on the occasion of a convincing victory in these elections that will help deepen with Duma’s aid the political project allowing Russia to rejuvenate in the 21st century and to turn into a core power in the setting up of a multipolar, peaceful and democratic world,” the agency said.

Venezuelan government believes the victory will impart an impulse to a further consolidation of political ties and broad cooperation with Russia that has arisen from a strategic union enabling the two countries to effectuate mutual projects in the vital areas, including the construction of housing, power engineering, and the financing of agriculture and industries, the address said.

Venezuelan authorities voice he confidence that the eighth session of the high-level Venezuelan-Russian intergovernmental commission, due to be held in Moscow December 7 and December 8, will be crowned with a success.

“This country expresses its firm intention to continue the implementation of projects bringing tangible benefits to the two peoples,” the news agency said.

Azerbaijan, Russia Presidents hold phone conversationhttp://en.trend.az/news/politics/1965626.html

5 December 2011, 23:21 (GMT+04:00)

Azerbaijan, Baku, Dec. 5 / Trend /

President of Azerbaijan Ilham Aliyev on Monday made a telephone call to Russian President Dmitry Medvedev, the press-service of Azerbaijani President reported.

The Head of State congratulated the Russian President on the victory of the Yedinaya Rossia Party (United Russia Party), the list of which led by him, in the elections to the State Duma of the Federal Assembly of the Russian Federation.

President Medvedev, in turn, thanked the Azerbaijani leader on the attention and congratulation.

During the conversation the presidents expressed satisfaction with development of relations between the two countries in various spheres.

They also expressed confidence that bilateral relations would further develop.

Do you have any feedback? Contact our journalist at agency@trend.az

CEC chairman: Official results of State Duma election to be announced before SaturdayToday at 10:07 | Interfax-Ukraine MOSCOW - Russian Central Election Commission (CEC) Chairman Vladimir Churov has promised to announce the official results of the Dec. 4 parliamentary election before Dec. 10.

"We plan to do so before Dec. 10," Churov told Interfax on Tuesday.

It means that the official results of the State Duma election could be announced much earlier than Dec. 19, the latest possible date set by the electoral preparations, conduct and vote counting calendar.

Churov said earlier that the Central Election Commission was not going to delay the official announcement of the election results.

"Probably, summing up the official results will not take us long," he said.

Read more: http://www.kyivpost.com/news/russia/detail/118248/#ixzz1fk0t7OXz

Moscow election protesters remain in custodyhttp://en.ria.ru/russia/20111206/169393995.html

12:09 06/12/2011

MOSCOW, December 6 (RIA Novosti)

Most of the 300 protesters detained on Monday at a demonstration in downtown Moscow against alleged electoral fraud remain in custody as of Monday morning, police said.

Two rally leaders, anti-corruption blogger Alexei Navalny and opposition activist Ilya Yashin, were delivered to court on Tuesday morning, said Navalny’s wife, Yulia, in a Twitter blog. Both face up to 15 days behind bars for refusing to obey police orders.

The demonstration - the largest opposition rally for many years in Moscow - was called to protest alleged violations during Sunday's parliamentary polls, in which Prime Minister Vladimir Putin's United Russia party just managed to hang onto its majority.

Police moved against the 5,000-strong rally after Yashin urged protesters to move towards the Kremlin.

Amnesty International called on the Russian authorities on Monday night to release the detained protestors, calling them “prisoners of conscience.”

"These disgraceful detentions highlight once again the failure of the Russian government to respect its citizens’ rights to freedom of expression and assembly," said Nicola Duckworth, the head of Amnesty’s Europe and Central Asia Program.

As the protests broke out, state-run TV channels continued to broadcast footage from a United Russia youth group event on Red Square. The concert stage at the rally, which ended before the demonstration began, was decorated with United Russia’s logo and the words “A Clean Victory.”

United Russia’s youth wing, the Nashi movement, have also demanded that Navalny be charged with violating election laws after he revealed preliminary voting results from polling stations in his blog on Sunday.

Several journalists from Reuters, Bloomberg and some Russian opposition media were detained and then briefly released after the rally.

Some 120 people were also detained at a similar protest in St. Petersburg on Monday evening.

Russia's ruling party faces fraud allegationshttp://in.reuters.com/article/2011/12/06/us-russia-election-violations-idINTRE7B429Z20111206

6:16am IST

By Thomas Grove and Steve Gutterman

MOSCOW (Reuters) - Olga Lazareva, a communist working as a polling station official in Russia's parliamentary election, says she woke a few hours before the polls opened to find her apartment door had been glued shut.

The glue, she said, was meant to delay her arrival on Sunday at the voting station in Tula, south of Moscow, where her approval was needed to confirm ballot boxes were empty and a free and fair election could begin. She managed to get out by calling relatives who forced open the door.

Lazareva said she suspects other commission members planned to stuff the boxes with ballots for Prime Minister Vladimir Putin's United Russia, which had its majority in parliament cut by voters tired of the entrenched ruling party.

She said by telephone that four other communists had similar experiences at polling stations in her neighborhood as part of what Tula's communists said was a series of dirty tricks intended to boost the vote for Putin's party.

"There were unprecedented violations in this election," said Lazareva, 60. "I have been on the commission since 1990 and I've seen a lot, but I have never see such blatant misconduct."

Although there was, in the end, no ballot-box stuffing at Lazareva's polling station, the communist campaign chief in Tula, Valentina Mishina, said it was widespread in the province.

"When boxes were opened there were packs of 50, 60 ballots folded in half and bundled up, all clearly filled out by the same hand," Mishina said.

Communist leader Gennady Zyuganov, whose party came second with nearly 20 percent of the vote, said it was the dirtiest election since the collapse of the Soviet Union in 1991 even though United Russia suffered a big decline in support.

European observers said the vote "was characterized by frequent procedural violations and instances of apparent manipulation, including several serious indications of ballot box stuffing."

They said the field was slanted in United Russia's favour and the campaign was marked by "limited political competition and a lack of fairness."

President Dmitry Medvedev, who is stepping aside next year to allow for Putin's return to the top seat of power for the world's largest energy producer, rejected allegations of fraud and called the vote "fair, honest and democratic."

BALLOT STUFFING

Tiny Kox, head of the delegation of monitors from the Council of Europe parliamentary assembly, said numerous ballots were found folded together in a sign of ballot stuffing at about 10 percent of the polling stations his team monitored.

Both the White House and U.S. Secretary of State Hillary Clinton said they had "serious concerns" about the conduct of the election.

The communists said they had won more votes than the result recorded for them and threatened legal action.

Vladimir Zhirinovsky's nationalist LDPR party also cried foul, saying its monitors were thrown out of polling stations in the oil-producing region of Bashkortostan and in the Black Sea Krasnodar region.

A spokesman, who declined to be named, said election commission members in the Siberian Chelyabinsk province had been openly campaigning for United Russia inside the polling station.

Political analysts say the centralization of power under Putin during his eight-year presidency until 2008 encourages abuses because many regions compete to secure the highest vote for United Russia -- a show of loyalty they hope will be rewarded by a bigger share of state handouts.

A cyber attack shut down the website of independent Russian election monitor Golos and prevented it displaying an interactive map showing reports of alleged violations.

"The attack was an attempt to close down our reporting on violations, because the violations we have shown reflect very poorly on the people who are in power," said Golos deputy director Grigory Melkonyants.

(Editing by Timothy Heritage)

RUSSIA VOTES: Putin and Russia are the winners in this election

http://www.bne.eu/storyf3098/RUSSIA_VOTES_Putin_and_Russia_are_the_winners_in_this_election

bne December 5, 2011

The surprise result in the Russian parliamentary elections was that everyone was awarded pretty much the votes they actually got.

There were few surprises in the actual results. United Russia walked the ballot to take 49% of the vote with most of the votes counted. Then the Communist Party of the Russian Federation took another 20%, Vladimir Zhirinovsky’s nationalist LDPR won 12% and centre-left Just Russia another 12%. The remaining parties on the list failed to clear the 7% threshold needed to get any seats.

But what is so surprising about these results is that they were more-or-less the same as what the polls had been predicting, meaning the Kremlin accepted the results in what should be called the first truly free and fair elections since Putin came to power in 2000.

A few caveats here: the state still has a monopoly over the media and the opposition was seriously hindered in its efforts to campaign by dirty tricks and official obfuscation. Still, the danger was that the Kremlin would attempt to stuff ballots and ensure that United Russia won 62% of the vote and so gain a constitutional majority. What has actually happened is managed democracy in action: the state let the people have a real vote, but has ensured that the winners of the vote remain inside the political ring-fence set up by the Kremlin around the political process.

If you compare this result to votes in the West, then clearly it is disappointing. But compared to most of the countries in Eastern Europe and Central Asia, it was truly representative.

Still at the helm

Nevertheless, the bottom line is the Kremlin remains firmly in charge. United Russia’s votes together with the loyal LDPR means it will still have a constitutional majority. What has changed here is Zhirinovsky has been promoted to a major force in Russia politics. However, completely loyal, totally cynical and eminently corruptible, Zhirinovsky is more than an acceptable candidate for this new role, as the LDPR has always toed the Kremlin line and won't change now that it has real power.

The biggest surprise was the strong showing by the Communist Party. The strong support has nothing to do with Gennady Zyuganov's campaigning; clearly the strong support was a protest vote, as the Communists were the only true opposition on the ballot, ineffective and unappealing as they are.

Ironically, this is what happened in Central Europe in the aftermath of the collapse of the Soviet bloc: the communist parties remade themselves and won power in the first few years of independence. They were not very effective and were mostly voted out again, but their stint in office served to focus the liberal parties on the need to address the concerns of the people and come up with credible policies. No-one seriously expects Russia’s Communist Party to go so far as to actually win office, but by allowing it to do so well the Kremlin will have to up its game and think more about what the people want or else face even worse results in the next election.

And the elections have set a precedent: by allowing a more-or-less free vote this time round, the Kremlin will find it harder to blatantly fix any elections in the future. The Kremlin probably had the Orange Revolution in Ukraine, the revolution in Kyrgyzstan and most recently the riots in Belarus a year ago in mind when it decided to accept a real vote – after all, the Kremlin remains in power even if its grip has been weakened.

As Putin Forces Hold On To Power, Evidence Mounts Of Pre-Election Press Crackdownhttp://www.worldcrunch.com/putin-forces-hold-power-evidence-mounts-pre-election-press-crackdown/4228

Prime Minister Vladimir Putin's United Russia won slightly less than 50% of the vote in the State Duma elections, which coincided with an unprecedented series of threats against media and hacker episodes against websites of many liberal outlets, including Kommersant.

By Alexander ZhuravlevKOMMERSANT/Worldcrunch

MOSCOW--On the day of the State Duma elections, the chief editor of the online publication gazeta.ru Mikhail Katov was summoned to the headquarters of Russia’s state media watchdog Roskomnadzor.

The day before, he had received notification that his site violated media regulations in its coverage of the Duma elections. “It turned out that the reason for the summons were two letters, one signed by the head of the Central Executive Committee, Vladimir Churov, and another by the deputy attorney general, Alexander Buksman,” Katov said.

The main claim was that gazeta.ru was publishing information about violations the United Russia party allegedly committed during the pre-election period. “The committee did not recognise these violations, and therefore they considered the publication of this information as ‘illegal agitation,’” Katov said.

“Surprisingly, no concrete examples of our violations were presented; they simply told us that we were behaving badly,” the editor added. “They wanted us to talk about United Russia as one would about the dead, to say only good things. In that way, the media was pressured.”

But Katov stressed that despite the warnings he received: “Gazeta.ru will stick to its editorial policy.”

Roskomnadzor has refused to comment. Meanwhile, Prime Minister Vladimir Putin and President Dmitry Medvedev's United Russia party held on to parliamentary power in the Duma elections, though its popularity has slipped considerably.

Hackings go uninvestigated

Shortly after the voting ended, the website of the radio station Echo Moscow crashed. Editor-in-chief Alexei Venedictov said the site was victim of a DOS attack and was offline from 6.40 a.m. The station has already appealed to the Central Executive Committee, and Venedictov will make a complaint to the Prosecutor General.

“We directly link the attack on the Echo Moscow site with the information about the State Duma elections, and in particular, details of election violations which were published on our site,” said Venedictov. “The attack on the site on election day was obviously linked with attempts to disrupt publication of information about the violations.”

The chairman of Echo Moscow’s board of directors, Nikolai Senkevich, said: “I think that any hacker attack on any resource that leads to financial losses is tantamount to theft.”

The websites Live Journal, slon.ru, as well as the sites of the newspaper “Big City” and the New Times also stopped working. The day before the elections, the website of Kommersant was subject to a hacker attack, resulting in a 35% drop in visitors.

The head of Kommersant’s legal division, Georgi Ivanov, said the paper would file a complaint, but is not holding its breath over any investigation. “Whenever there is a hacker attack, we always make a complaint, but it is simply an expression of our position, a symbolic gesture. None of our complaints have ever led to anything,” he said. “Honestly, I don’t think I have heard of any case of DOS attacks being successfully investigated."

Also affected was the website of the country’s only independent election observer, Golos, which was targeted over several days and even accused of treason for accepting western financial grants. The watchdog’s director, Lilia Shibanova, was detained at a Moscow airport for 12 hours and her laptop seized while a court fined Golos $1,000 for violating a law that prohibits publication of election opinion research five days before a vote.

Back in April, Russian President Dmitry Medvedev discussed hacker attacks with the editors from the mass media and pledged to find experts that could investigate them. But Novaya Gazyeta editor-in-chief Dmitry Muratov doubted this would happen as this would effectively mean that “the group that carries out attack, will investigate them.”

Read more from Kommersant in Russian

photo - adagamov via twitter

All rights reserved ©Worldcrunch - in partnership with Kommersant

Investors Upbeat About New Duma 06 December 2011By Anatoly Medetsky

United Russia won enough seats to usher government-sponsored bills through the State Duma, but the decline in popular support for the ruling party as revealed by Sunday's elections will likely have consequences that reach beyond law making.

Led by President Dmitry Medvedev and Prime Minister Vladimir Putin, the party will occupy 238 seats in the new Duma, while a bill requires at least 226 votes to pass.

The loosening of the tight grip that United Russia had on the previous Duma, where it counted 315 deputies, could trigger earnest liberal reforms and a few showcases in the tepid fight on corruption. This could allow the government to win over voters who are not placated by the state's increased social spending.

"Its good news because it will hopefully give the message to the leadership that it will have to change to continue to be successful," said Jochen Wermuth, chief investment officer at Wermuth Asset Management.

Some of the changes would have to appeal to the 47 million-strong Internet-using middle class who hardly have any representation in the new Duma, he said.

"To not lose these people who want to modernize the country, the Russian authorities will have to start implementing reforms that will make them happy — independent judges, rule of law, fighting corruption," Wermuth said. "There could be a war on corruption — not with words but actions — for example, putting in prison high-level people who have taken or given bribes at the high level. That would be a chance to impress people."

Some investment banks and asset managers predicted that the swollen ranks of the leftist forces in the Duma could prompt the government to undermine their support by expanding social spending. The Duma election results could "induce extra populist

steps on the part of the country's leadership to move the needle of public opinion" ahead of the presidential election March 4 where Putin will run, VTB Capital said in a note to investors Monday.

Tim Ash, head of emerging markets research at Royal Bank of Scotland in London, said: "The natural instinct for Putin will be to pump more money into the economy," Bloomberg reported.

Viktor Szabo, who helps manage about $7 billion in emerging market debt, including Russia's ruble eurobond, at Aberdeen Asset Management in London, also agreed about the prospect of increased spending, saying it could stoke inflation.

But the most plausible interpretation of the success at the polls for the Communist Party and A Just Russia is venting frustration with United Russia, both Alfa Bank and Wermuth said.

"We do not see this necessarily as nostalgia for Soviet times, but rather as an indication of protest voting," Alfa Bank chief economist Natalia Orlova and analyst Dmitry Dolgin wrote in a note to investors Monday. "Supporting the Communists as a prominent second party was the most obvious way to vote against United Russia in the absence of a legal means to express this view."

Therefore, the government should think twice before dipping into the budget to spend more in response, an option that would strain state finances further, Wermuth said.

"I have some faith that the Russian government is professional enough to understand that they have already overcommitted themselves in the 2012 budget and there's no room for more social expenditures," he said.

In terms of Duma operations, United Russia's majority will provide enough support for Putin as the likely next president and Medvedev as the likely next prime minister.

"It will allow us to work calmly and rhythmically," Putin said at a Presidium meeting Monday.

United Russia's faction will still be able on its own to confirm prime ministers, express votes of no confidence to the Cabinet, appoint and remove Central Bank chairpeople and pass any legislation — though it doesn't have enough seats to unilaterally change the Constitution.

"They still have a chance to pass through the parliament all the required reforms," Wermuth said. "United Russia can still rubber-stamp anything. It's positive in a sense because if they are serious about reforms they can make a difference."

Read more: http://www.themoscowtimes.com/business/article/investors-upbeat-about-

new-duma/449312.html#ixzz1fjTyS0St The Moscow Times

Power carve-up in Duma after ruling party’s poll slumphttp://rt.com/news/parliamentary-united-russia-protests-117/

Published: 6 December, 2011, 11:07Edited: 6 December, 2011, 11:07

The dominant force in Russian politics, United Russia, will for the first time have to learn the art of compromise following the erosion of its parliamentary majority in State Duma elections at the weekend.

With the vote count all but completed, the overall picture of a brand new board of lawmakers is now emerging.  With just under 50% of vote, the party of the president and prime minister has lost significant clout, its parliamentary muscle a shadow of the two-thirds majority it boasted for years.

Among the parties United Russia will have to court or combat in the new parliament are the Communists, who came in second, and Fair Russia and the Liberal Democrats, who also secured Duma mandates.

The four other parties which took part in the elections failed to pass 7 per cent vote barrier required to ensure seats in the new lower house.

In contrast to the 2007 election, when United Russia got 64 per cent of the vote, in 2011, the party failed to gain a constitutional majority – the much-coveted two thirds – in the Russian State Duma.

However, since the votes polled by parties which failed to reach the threshold will be distributed among the winners, the United Russia Party is set to end up with more than 50 per cent of the seats, which means they will be able to pass all bills proposed by the cabinet. It means they will not need to form a coalition with any other party.

However, United Russia’s top brass have made public their intention to form alliances within the  Duma.

Meanwhile, as RT's Ekaterina Gracheva reports, early results have left some voters angry. On Monday in the center of Moscow, several thousand protesters gathered to express their discontent with the result of the parliamentary vote.

Around 5,000 people came to a rally sanctioned by the Moscow authorities.

Protesters chanted “Russia needs new elections,” “Russia without Putin,” “Revolution,” and “Shame.” Police did not intervene in the rally until several hundreds protestors took to neighboring  streets. After the crowd attempted to attract attention by disrupting traffic, they faced a police cordons and up to 300 were arrested.

A similar situation unfolded on Monday in Saint Petersburg, where several thousand protesters rallied in favor of different opposition parties and against the way the election had been conducted.

Also on Monday, a pro-United Russia rally which took place in central Moscow passed off peacefully.

Meanwhile, some international observers have spoken of fraud and widespread violations of election rules, while others have insisted any irregularities were insignificant, declared accusations unjustified, and maintained that the vote should be considered legitimate. 

President Dmitry Medvedev has promised that any accusations of electoral fraud will be investigated and anyone found guilty of infringements prosecuted.

Russia downgrades ties with Qatar after attack on Russian diplomatshttp://www.washingtonpost.com/world/europe/russia-downgrades-ties-with-qatar-after-attack-on-russian-diplomats/2011/12/05/gIQAWlnqWO_story.html

By Associated Press, Published: December 5

MOSCOW — Russia on Monday demanded an apology from the government of Qatar for an attack on three Russian diplomats and said it will downgrade its diplomatic relations.

Russia’s Foreign Ministry said that its ambassador to Qatar, Vladimir Titorenko, and two other diplomats were attacked by security officers at the airport in Doha, the capital.

It said the officers tried to forcibly seize a parcel from a diplomatic pouch the ambassador was carrying, and the ambassador was hospitalized after the attack.

The ministry said the incident will have the “most negative consequences” on ties between Moscow and Doha, but did not specify the measures it will take.

In Qatar, Titorenko said he plans to leave the Gulf country after medical treatment. He said the “ball is on the Qatari side” to issue an apology or risk a diplomatic rift with Moscow.

Copyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Russian ambassador to leave Qatarhttp://english.ruvr.ru/2011/12/05/61601948.html

Frolova InessaDec 5, 2011 19:49 Moscow Time

Russia is lowering the level of its diplomatic relations with Qatar. The reason is an attack against the Russian ambassador at the airport of that country’s capital Doha. Alexander Boldyrev, deputy chairman of the Department of the Press and Information of the Russian Foreign Ministry gave more details to The Voice of Russia:

“In the evening of the 29th of November Russian Ambassador to Qatar Vladimir Titorenko, who was on his way back from Jordan where he had been on business, was attacked by security and customs officers at the Doha airport. They tried to seize his sealed diplomatic pouch. The aggressive actions of the Qatar side caused damage to the ambassador’s health. Two Russian diplomats who were meeting  Titorenko at the airport were also hurt.”

Announcer: The staff of the Russian embassy had permission of the foreign minister of Qatar to carry the diplomatic pouch across the border without examination. This is the usual routine for diplomatic missions which is regulated by the Vienna Convention. However, the staff of the Doha airport made an attempt to deprive Titorenko of his bag with diplomatic mail and put it through an X-ray machine. This is an unprecedented violation of international rules. Probably, this was Qatar’s response to Russia’s position concerning Syria, believes Veniamin Popov, the director of the Centre of Partnership of Civilisations at the Moscow State Institute of International Relations and Russian ex-ambassador at large:

“Our relations with Qatar are complicated. Several years ago one of the leaders of the Chechen opposition was killed there. Two of our employees were detained and later released after long negotiations. The most important factor is that the Al-Jazeera TV channel is based in Qatar. A serious reshuffle in the channel’s management took place recently and the policy of the channel has changed, especially concerning the events in Libya and Syria. Now Al-Jazeera is attacking Russia’s position on Syria. Russia is in favour of stopping the violence there and preventing a civil war and foreign interference in that country. Russia supported the initiative of the League of Arab States. However, the channel is accusing Russia of supporting dictators rather than people. This can be

ascribed to anyone except Russia. We have always supported people, this was a tradition in Soviet times and we are keeping it up.”

The Russian ambassador managed to defend the diplomatic mail; however, Moscow does not intend to tolerate this treatment. Vladimir Titorenko will leave Doha in a few days. Until Qatar officially apologises, Russia’s interests in Qatar will be represented by a charge d’affaires, the Russian Foreign Ministry declares.

Qatar vs Russia: When size does not matterhttp://rt.com/news/qatar-russia-syria-usa-115/

Published: 6 December, 2011, 10:16Edited: 6 December, 2011, 10:16

Russia is downgrading its relations with Qatar following an attack on its envoy in Doha. The assault is being linked to Moscow's criticism of Qatar's backing for the US position on the unrest in Syria.

A little country with gigantic ambitions – Qatar, with a population of less than two million people, has embarked on an aggressive plan to shape the Arab world. By playing in tune with Washington’s policies in the region, Qatar has gained a diplomatic weight it never had before.

“The Qataris feel as if they’ve had enormous backing, and that they’ve become sort of larger than life, especially now, with the focus on Syria,” a senior editor at Executive Intelligence Review, Jeffrey Steinberg, told RT. “As a factor in the politics of the region, they’re currently the chairman of the Arab League, and they’ve used that position to press for the most aggressive kind of action against Syria.”

Qatar became the first Gulf nation to close its embassy in Syria in July. Qatar is also reportedly funneling weapons to Syrian rebels, as it did in Libya. The country’s cheerleading role in revolutions in the Middle East and North Africa has earned Qatar praise and applause from the West, with this plaudit coming from US President Barack Obama: “Qatar has not only supported [us] diplomatically, but has also supported [us] militarily, and we are very appreciative.”

And this, from US Secretary of State Hillary Clinton: “The partnership between our two countries is a model.”

America has gone from branding Qatar’s Al Jazeera “a terrorist channel,” to openly praising the international television news station, with US Senator John McCain declaring, “Al Jazeera has played a key and leading role.”

But Qatar has come under increasing criticism from Russia for its aggressive involvement in the affairs of other countries in the region. Last week at Doha airport, the Russian Ambassador to Qatar, along with two Russian embassy officials, was physically assaulted by Qatari customs and security officers when they made an attempt to confiscate a diplomatic bag.

It is this incident which has led to Moscow downgrading formal relations with Qatar.

“They get a sense that anything that they do to really stick a finger in the eye of Russia or any other BRICS country will be applauded in certain circles in the West, and rewarded,” Jeffrey Steinberg explained. “I think it’s all about that sense that they are on the front edge, and Russia is not falling in line around the Syria issue.”

The incident took place on the same day as Russia’s Foreign Ministry criticized Qatar for supplying weapons to Libyan rebels in violation of a UN arms embargo.

The US, which has a military base in the country, has Qatar’s full backing for its Middle East ventures. With Syria now in play, Washington is betting high on Doha.

“Qatar has been put forward as the Arab face on this bullying operation,” Steinberg added.

Tiny Qatar, empowered by the US, is now playing big, striving to punch above its weight to shape the turbulent region in its favor. And the incident at the airport with Russian diplomats showed what happens when someone gets in its way.

Russian icebreaking tanker set to deliver fuel to Alaska townhttp://www.reuters.com/article/2011/12/06/us-alaska-nome-fuel-idUSTRE7B503A20111206

8:30pm EST

By Yereth Rosen

ANCHORAGE, Alaska (Reuters) - A Russian tanker with icebreaking capability will make an emergency fuel delivery to Nome, Alaska, after a massive winter storm turned back a barge carrying the city's last regularly scheduled fuel delivery.

The Sitnasuak Native Corporation said it had signed a contract to have a vessel owned by the Russian company RIMSCO deliver 1.5 million gallons of fuel to Nome by year's end.

The operation, if successful, will allow Nome residents to avoid a serious fuel shortage later this winter resulting from the missed barge delivery, said Jason Evans, Sitnasuak's chairman.

Nome, a city of about 3,600, lacks outside road access and depends on ships and aircraft for supplies. Fuel prices are already high -- averaging about $5.40 for a gallon of gasoline -- but a shortage later in the winter could have added several dollars to that per-gallon price.

Sitnasuak, which owns one of two local Nome fuel distribution companies, had missed the year's final scheduled barge delivery of fuel.

A barge carrying 1.6 million gallons of gasoline, diesel fuel and heating fuel failed to reach the port of Nome because of bad weather and sea-ice chunks blown into the harbor by hurricane-force winds in a storm last month that was considered the strongest in western Alaska since 1974.

With the barge delivery canceled, Sitnasuak had been considering flying in fuel later in the year, an expensive option. Delivery by the Russian vessel is more expensive than the traditional barging method, but is substantially less than flying in fuel, Evans said.

Sitnasuak said its contract is with Vitus Marine LLC, an Alaska shipper that came up with the idea of using a RIMSCO ice-breaking fuel vessel, Evans said.

"We were reaching out to everyone and anyone that had any sort of possible scenario to get fuel to Nome," Evans said.

If successful, it will be the first marine delivery of petroleum products to western Alaska conducted in winter, Sitnasuak said.

The RIMSCO ship, called the Renda, will carry fuel from Inchon, South Korea, to Nome, Evans said. It is expected to take 20 to 25 days for the ship to make the journey from the port at Vladivostok to Inchon and then on to Nome, Evans said.

The U.S. Coast Guard has pledged to help the Renda make the voyage and will use the icebreaking cutter Healy to help clear a path for the tanker if necessary, Evans said.

The fact that a Russian ship will be delivering Korean fuel to oil-rich Alaska "does have some irony to it, Evans said. "But certainly we live in a global economy nowadays."

Sitnasuak is owned by 2,400 Inupiat Eskimos who live in Nome or have family ties to the area.

(Editing by Dan Whitcomb and Cynthia Johnston)

10:08 06/12/2011ALL NEWS

SK to investigate lawfulness of children foreign adoption

http://www.itar-tass.com/en/c154/290239.html

MOSCOW, December 6 (Itar-Tass) —— The Russian Investigative Committee will investigate the lawfulness of the foreign adoption procedure of Russian children, who died abroad, spokesman of the Russian Investigative Committee Vladimir Markin told Itar-Tass on Tuesday.

“The Investigative Committee intends to investigate the lawfulness of the foreign adoption procedure of Russian children, who died or were exposed to violence abroad,” he said. “If the violations of Russian public officials, who should protect the interests of children in their adoption, are found, the Investigative Committee will take the most decisive measures to bring the guilty officials to responsibility under the law,” he said.

The Investigative Committee will use the information of the Russian presidential children’s ombudsman and his envoys in the regions to find these crimes.

09:57 06/12/2011ALL NEWS

SK opens criminal case over RF adopted son murder in US

http://www.itar-tass.com/en/c154/290226.html

MOSCOW, December 6 (Itar-Tass) —— The Russian Investigative Committee opened a criminal case over the murder of a Russian adopted son Ilia Kargintsev in the United States, spokesman of the Investigative Committee Vladimir Markin told Itar-Tass on Tuesday.

“The main investigation department of the Investigative Committee opened a criminal case over the murder of an underage Russian citizen Isaac Jonathan Dexter (Ilia Kargintsev) in the US under Article 105 Part 2 of the Russian Criminal Code,” he said.

Russian president Special Deputy Vladimir Rushaylo arrives in Kyrgyzstanhttp://eng.24.kg/cis/2011/12/06/21882.html

06/12-2011 09:08, Bishkek – 24.kg news agency

Russian president Special Deputy Vladimir Rushaylo arrived in Kyrgyzstan.

According Russian Embassy the Special Deputy of Dmitry Medvedev will participate in a series of meetings with Kyrgyz authorities and in an international charity special where 180 wheelchairs will be granted to people with disabilities.

Also Vladimir Rushaylo will meet with journalists.

URL: http://eng.24.kg/cis/2011/12/06/21882.html

05:40 06/12/2011ALL NEWS

Official says labor migrants will have to learn Russian language

http://www.itar-tass.com/en/c154/290110.html

MOSCOW, December 6 (Itar-Tass) – Labor migrants from other countries will have to learn the Russian language if they seek permits for getting jobs in Russia, Konstantin Romodanovsky, the director of the Federal Migration Service said in an interview that the governmental Rossiyskaya Gazeta daily published Tuesday.

He indicated that command of the Russian language will be one of the main conditions for getting employment permits here.

“We believe that every migrant coming here should know the basics of the Russian language as a minimum because it’s impossible to ensure the social and legal defense of migrants otherwise,” Romodanovsky said, adding that the migrants who do not speak at least some Russian find the adaption to everyday reality in this country very difficult.

“Our stance is clear,” he went on. “The fewer the chaotic elements in the migration process, the less lawlessness there will be in the treatment of migrants here and the firmer the guarantees that the Russian authorities will be able to give to them.”

Officials at the Federal Migration Service say about 13 million to 14 million foreign citizens come to Russia every year and the majority of them arrive here for the sole purpose, which is to earn some money.

More often than not, the migrants are young people whose school years fell on the 1990’s when Russian was being squeezed out of use on the greater part of the former Soviet territory.

In many cases, it is the youngsters living in small towns or villages who have to leave their native places and turn into migrants, and the teaching of Russian suffered the most in the1990’s precisely at small-town and rural schools.

That is why there is no surprise in the expert assessments, the most optimistic of which suggest that 50% foreign workers as a minimum cannot fill out even the elementary documents in Russian without someone else’s aid.

In quite a number of cases, the migrant workers do not understand the Russian language at all.

The Federal Migration Service has changed over form words to practical actions in what concerns the adaptation and integration of migrants. It has opened 55 multifunctional centers across Russia where foreigners get consultations on the problems of legislation.

Also, it has set up a department for assistance to integration that works in contact with ethnic communities, and the training of citizens of Tajikistan and Kyrgyzstan willing to get jobs in Russia has begun.

Similar programs are in the offing in other former Soviet republics. Group classes have begun for the people who want to acquire some professional training and learn the basic language.

In addition to this, the future labor migrants are offered classes of Russian legislation and the basics of Russian culture and traditions.

International experience shows that the processes of adaption are mostly steered by the ethnic communities, religious and/or public organizations.

This practice exists in Russia, too. For instances, ethnic communities have organized successfully operating courses of Russia in Moscow, Chelyabinsk, Krasnodar, Kaliningrad, Yaroslavl, and some other cities and regions.

Double terrorist attack in Dagestanhttp://vestnikkavkaza.net/news/society/20648.html

A blast happened at a shop on the Street of I. Kazak in the Khanar Village of Kizilyurt at 00.10. Unidentified assailants activated a bomb, injuring a 70-year old man guarding the shop with projectiles. A crater with diameter of 1 meter and 50 cm deep was found, RIA Dagestan reports.

Another blast occurred on the 2nd km of the Kizilyurt-Shamkhalyangiyurt motorway at 00.30. A bomb equivalent to about 10 kg of TNT went off. 3 police officers were injured, their vehicle damaged. A crater with diameter of 4.5 m and 1 m deep was found.

http://ria.ru/incidents/20111206/507783335.html

GOOGLE TRANSLATION

Four people were injured in explosions in Dagestan06/12/2011 07:41MAKHACHKALA, December 6 - RIA Novosti. Two explosions thundered on Monday night in Daghestan Kizilyurt, injuries to guard the store, wounded three policemen, said Tuesday RIA Novosti representative of Ministry of Internal Affairs of Dagestan."At 00.10 in the village of Hanaro Kizilyurt on the street near the store Irchi Kazak unknown persons set in motion an unidentified explosive device capacity of about five kilograms of TNT equivalent, without damaging elements. The explosion keeper store, Born in 1942, with shrapnel wounds in different parts of the Body taken to hospital. The two-story brick building was severely damaged store. In place of the explosion crater with a diameter of one meter and 50 centimeters deep, "- said the source.According to him, at 00.30 in the second kilometer of the motorway "Kizilyurt-Shamhalyangiyurt" when leaving the scene of an immediate response to service armored car "UAZ" unknown persons set in motion an unidentified explosive device of about 10 pounds of TNT without damaging elements set at the roadside"The explosion in the hospital with a concussion placed three employees of the Russian Interior Ministry" Kizilyurt. "Utility vehicle was damaged. In place of the explosion crater with a diameter of 4.5 meters, a depth of one meter," - said the official.According to the official representative of the Investigation Department of Insurance of the Russian Federation in Dagestan, is currently under further inspection of the scene, working group of investigators, the question of criminal proceedings.The investigation opened a criminal case under several articles of the Criminal Code, including the assault on the lives of law enforcement and the illicit manufacture of explosives. The maximum penalty - life imprisonment. "The cause of the inquiry may add another article to be confirmed when the victim's state of the guard," - said the official.

Dagestani Brothers Jailed in Terror Case 06 December 2011The Moscow Times

Two Dagestani brothers living in Moscow were both sentenced to 14 months in prison Monday for harboring a female member of an Islamist group that had planned terror attacks in the capital.

The Kuzminsky District Court ruled that Sultan and Sadir Abdulkerimov knew Zeinab Suyunova’s plans to execute a suicide attack on Red Square on New Year’s Eve last year and offered her shelter, rather than inform police.

“Suyunova arrived in Moscow to carry out a terrorist attack by blowing herself up during festivities ,” prosecutors said. “The Abdulkerimov brothers provided her with new clothes and a hiding place in their apartment, thus concealing her from law enforcement authorities.”

After one of her accomplices accidentally detonated a bomb on Dec. 31, the FSB were alerted and Suyunova sought refuge with the brothers.

She later escaped to Volgograd, where she was detained and confessed.

Read more: http://www.themoscowtimes.com/news/article/dagestani-brothers-jailed-in-terror-case/449294.html#ixzz1fjURHDHV The Moscow Times

04:30 06/12/2011ALL NEWS

Eight coaches carrying coal go off track at Baikal-Amur Railway

http://www.itar-tass.com/en/c154/290100.html

IRKUTSK, December 6 (Itar-Tass) – An estimated eight freight coaches carrying coal went off the track at the Lena-Chudnichny section of the Baikal Amur Mainline /BAM/ Tuesday morning, the corporate communications service of the East-Siberian branch of the Russian Railways told Itar-Tass.

“There are no victims and no danger for the ecology,” a railway spokesman said. “Traffic at that section of the mainline has been suspended.”

Repair trains from another three BAM stations have been dispatched to the spot of the accident and a special commission led by Acting Director of the East-Siberian railway branch, Nikolai Maklygin, has been set up.

Fair and Shows08:14 pm - Monday

Rosoboronexport: airplanes, helicopters and Russian technology at "LIMA 2011" (VIDEO)http://www.avionews.com/index.php?corpo=see_news_home.php&news_id=1136174&pagina_chiamante=index.php

Moscow, Russia - The exhibition will be held at Langkawi, Malaysia, between 6th and 10th this month

(WAPA) - The "Langkawi International Maritime and Aerospace" has been held since 1991. Today it is one of the most important arms exhibitions in the region. With the role of Asian-Pacific countries in international affairs growing dramatically over the past years, defense and security issues rise high on their national agendas as far as sustainable peace and development are concerned.

“South-East Asia is a very important market for us, as it accounts for a significant part of total sales by Rosoboronexport. Despite tight rivalry, we plan to expand our cooperation with the countries in this region. And not only in export of final products: we are discussing opportunities to launch joint weapon development projects, organize license production and establish maintenance and service centers here,” said Rosoboronexport’s deputy Director General Viktor Komardin, who led the company delegation at LIMA 2011.

Russia has good interaction almost with all nations in the region, working closely with traditional partners and those who have indicated their interest in establishing defense technology ties with Russia for the first time, such as Brunei, Cambodia, Nepal and the Philippines.

This year Rosoboronexport opted for a digital format of presentations, laying stakes on interactive capabilities of modern multimedia technologies. For instance, performance of MiG-29M multi-role fighter and Mi-28NE and Ka-52 attack helicopters will be demonstrated in this manner: simulated 3D videos give a comprehensive picture of their combat capabilities. Sukhoi’s Su-30MK fighters of various modifications are quite popular in the region. They are in service with the armed forces of Vietnam, India, Indonesia, Malaysia and China.

“This is a very good aircraft, and we believe it still has quite high export potential. It meets all modern requirements and offers huge opportunities for upgrade. For instance, we are looking forward to Malaysian Defense Ministry’s tender for a batch of new multirole fighters, as we are sure that our bid (the Su-30MK, Ed) will have very good chances to win. Trying to keep up with the latest trends on the arms market, we are willing to make an interesting offset proposal", Komardin pointed out.

By the way, Russian offset proposals will be announced during the "LIMA 2011", and in addition to Sukhoi maintenance and repair projects, will include localization of the components in the field of civil aviation, as well as transfer of different industrial technologies. Specialists also expect increased attention to Russian air defense systems. The experience of recent conflicts shows that an effective air defense is vital for the national security of any country.

South-East Asia is also one of the key markets for Russian helicopter manufactures. Rosoboronexport offers all types of helicopters that can operate in difficult climatic conditions and are much superior to rivals in terms of cost-effectiveness.

Most of the countries in the region have long coast border, that’s why protection of their 200-mile economic zone becomes one of top priorities. Rosoboronexport offers ships and submarines to achieve this goal and meet other national policy interests. In addition, Russia boasts modern technologies to deploy an integrated maritime and boarder control system which can include unique over-the-horizon (OTH) radar Podsolnukh-E.

Guests of the exhibition will receive full information about the following aircraft: Su-30MKM, Su-30MK2, MiG-35, MiG-29M, MiG-29SMT multirole fighters; Yak-130 combat trainer; Be-200 amphibian; Il-76MD transport plane.

And on the following helicopters: Mi-171Sh utility helicopter; Mi-28NE and Ka-52 attack helicopters; Ka-226T and Ka-32 multi-purpose helicopters; Mi-26T2 heavy transport; Scout Ka-31

The below video shows the MiG-29 of the Malaysian Air Force:

December 06, 2011 10:54

Moscow press review for December 6, 2011http://www.interfax.com/newsinf.asp?id=292769

MOSCOW. Dec 6 (Interfax) - The following is a digest of Moscow newspapers published on December 6. Interfax does not accept liability for information in these stories.

VEDOMOSTI

The decision to postpone the commissioning of the Baltic Pipeline System-2 will not influence Russian oil exports, but will affect Transneft's (RTS: TRNF) tariff revenue and the reputation of Rosneft (RTS: ROSN), the Russian Energy Ministry has said. Ministry and Transneft officials, however, refused to disclose the amount of revenue that will not

be received. "Poles and Belarusians will earn the money Transneft could have earned" because the oil the Baltic Pipeline System-2 was supposed to ship will now be sent through these countries, a source close to the monopoly said, declining to provide further details. ("Reputation slump")

Germany's Wintershall head Rainer Seele has disclosed the main recipe of his company's success - it is the establishment of joint ventures with the "right" partners, for example Russian gas giant Gazprom (RTS: GAZP). "In any case, the European market needs more gas, and gas pipelines are initially designed to response to a demand increase in the future. IEA and CERA have estimated that by 2020-2025, the EU's additional import needs will stand at around 100 billion cubic meters of gas. I agree that lowering transit risks is really important. We still remember what happened between Russia and Ukraine two years ago. But South Stream is not a political decision. This decision was made by a company that seeks to enhance the security of its own deliveries because a direct connection with the consumer offers the highest level of security," he said. ("We will never go to an arbitration court against Gazprom", Rainer Seele, Wintershall CEO")

The Guinean government could receive a stake in Crew Gold, according to Nord Gold's report dedicate to a spinoff of Severstal's (RTS: CHMF) gold mining business into an independent company. In September, the country drew up a new code, which requires the government to control at least 15% of gold mining enterprises' shares. The country should receive such a stake free of charge. The authorities have a right to acquire 20% for cash, the report says. Crew Gold is one of Nord Gold's key assets. It accounts for around 30% of gold mining operations, VTB Capital analyst Nikolai Sosnovsky said. Nord Gold spent the whole of the previous year collecting this company's shares, including in a tough competition with Canada's Endeavour Foundation. ("Guinea asking for gold")

KOMMERSANT:

The Kommersant newspaper has learnt that, like Bashneft and Tatneft (RTS: TATN), the Alliance oil company could receive compensation for possible losses following the introduction of the 60-66 tax regime. The company plans to ask the government to grant it privileges worth 4.5 billion rubles, which it will lose in 2012 due to the unification of export duties on light and dark petroleum products. (P. 11, "Alliance looking for resources in federal budget")

The Kommersant newspaper has learnt that Geoprospekt, a potential buyer of a 51% stake in the Dark Oil project in Angola, notified Alrosa (RTS: ALRS) a few days ago that it was not going to acquire this asset. Furthermore, the company claims that businessman Arkady Gaidamak, who offered to acquire the asset from Alrosa for $15 billion on the company's behalf in August, had no appropriate legal powers. Geoprospekt itself is registered at the same address as the Era charity fund, which was founded by Buryatia's Senator Vitaly Malkin, a former business partner of Gaidamak. (P. 9, "Alrosa left with oil")

KIT Finance bank (RTS: CITB), whose recovery cost the state 135 billion rubles, has paid off debts to its largest creditor - Deposit Insurance Agency - ahead of time. The bank repaid the remaining tranche of 4.4 billion rubles to the agency and announced the accomplishment of the recovery plan ahead of schedule. KIT Finance, however, chose to keep silent about loans totaling ten billion rubles borrowed from the Central Bank. (P. 9, "All recovery means are good")

The ILFC leasing corporation, which sought to collect nearly $3.5 million of back airline fees from Avianova through court, has recalled its lawsuit. The sides' representatives said that all of the complaints had been sorted out. Avianova said that agreements had been achieved with all leasing companies and airplanes had been returned to them. The airline promised to sort out other creditors' claims in order to liquidate the company as soon as possible. So far, only 81% of debts to passengers have been paid off. (P. 11, "Avianova paying off debts, returning airplanes")

Russian Press at a Glance, Tuesday, November 6, 2011http://en.rian.ru/papers/20111206/169387057.html

08:28 06/12/2011

POLITICS

 

Poll results gave United Russia a disappointing 49.5 percent of the vote by Monday morning after State Duma elections that took place amid an unprecedented series of detentions, threats and attacks against the independent media, election observers and opposition activists.

(The Moscow Times, Kommersant, Nezavisimaya Gazeta, Rossiiskaya Gazeta, Moskovskie Novosti, Vedomosti, Izvestia)

 

At least 5,000 protesters vented their frustration with the State Duma vote on Monday evening in central Moscow at one of the biggest liberal opposition rallies in recent years.

(The Moscow Times, Kommersant, Moskovskie Novosti)

 

South Ossetian opposition members continue to stand on the central Teatralnaya Square in the former Georgian republic to demand the recognition of Alla Dzhioyeva as their elected president in what outgoing President Eduard Kokoity described as an “orange revolution attempt”

(Kommersant, Nezavisimaya Gazeta)

 

The first parliamentary elections in Egypt after the fall of Hosni Mubarak paved the way for radical Islamic movements to take power. However, observers warn that the country might follow the path of Iran and Afghanistan

(Rossiiskaya Gazeta)

 

The Russian Foreign Ministry downgraded its status of diplomatic relations with Qatar after Russia’s ambassador was attacked and injured by security personnel in the Doha airport, who reportedly tried to seize his diplomatic mail. Russia demanded an official apology but there was no response so far

(Kommersant, Nezavisimaya Gazeta, Rossiiskaya Gazeta)

 

ECONOMY

 

The global economic downturn hasn’t hit Russians’ purchasing power significantly, with this year’s spending on gifts and entertainment during the New Year’s holidays expected to grow 11 percent from 2010, while most Europeans plan to cut their holiday expenditures.

(The Moscow Times)

 

Russia's annual inflation rate slipped in November to 6.8 percent, according to data on Monday showing a sixth consecutive monthly fall, increasing chances that the Central Bank may loosen monetary policy as the economy slows.

(The Moscow Times, Kommersant)

 

While Russia's expected accession to the World Trade Organization in 2012 could be used in a struggle between Gazprom and the European Union, the move is unlikely to have a big impact on the country's domestic gas industry or export revenues.

(The Moscow Times)

 

French President Nicholas Sarkozy and German Chancellor Angela Merkel met to discuss a joint plan to save the euro, which they are to put forward at the forthcoming summit in Brussels on Friday. Meanwhile, Analysts say that the financial reports some countries submitted upon their accession to the eurozone had been embellished and that real figures would have disqualified them from joining not only the eurozone but also the European Union

(Nezavisimaya Gazeta, Rossiiskaya Gazeta, Vedomosti)

 

METALS & MINING

 

Alexei Mordashov’s gold mining company, Nord Gold, may lose 15-35% in its largest asset, Guinea’s Crew Gold, which it acquired for almost $500 million

(Vedomosti)

 

OIL & GAS

 

Russia’s ambassador to Ukraine Mikhail Zurabov said new Russian-Ukrainian gas deals are likely to be signed before year-end

(Nezavisimaya Gazeta)

 

TNK-BP, currently developing a gas project in Vietnam that was acquired from its major shareholder BP, has also bid for ConocoPhillips assets in the Asian country, TNK-BP's head of upstream operations Alexander Dodds said

(The Moscow Times, Kommersant)

 

AEROSPACE

 

The U.S. Curiosity probe to Mars was sent on its journey under an optimal orbit, allowing it to cancel the previously scheduled path correction. Meanwhile, Russian scientists have almost lost hope in contacting Russia’s Phobos-Grunt probe

(Moskovskie Novosti)

 

TELECOMS & IT

 

Russia’s State Radio Frequency Commission may allow mobile phone operators to set up experimental LTE zones. However, the struggle between the “Big Three” mobile phone operators and Rostelekom for the right to build 4G networks is yet to come

(Kommersant)

 

SOCIETY

 

Two Dagestani brothers living in Moscow were both sentenced to 14 months in prison Monday for harboring a female member of an Islamist group that had planned terror attacks in the capital.

(The Moscow Times, Kommersant, Rossiiskaya Gazeta)

 

Russia’s Supreme Court has turned down a request by two companies of Domodedovo airport to declare illegal the Russian Transport Ministry’s move to make transport hubs responsible for security and prevention of terrorist attacks

(Kommersant, Moskovskie Novosti)

 

For more details on all today's news in Russia, visit our website at www.en.rian.ru

DECEMBER 6, 2011

Kremlin Is Seen Spending More After Setback http://online.wsj.com/article/SB10001424052970204903804577079981665998266.html?mod=googlenews_wsj

By WILLIAM MAULDIN

MOSCOW—The Russian government could increase spending to try to ensure a solid victory for Prime Minister Vladimir Putin in the March presidential election, after his party saw support wane in parliamentary polls, economists said.

In particular, Mr. Putin could push for targeted spending at state corporations. "The best way to address his fears of losing control will be to rely on a direct state presence in the economy," said Natalia Orlova, chief economist at Alfa Bank. "He'll be looking to secure his position economically."

Russia expects a budget surplus this year of less than 1% of gross domestic product, but the government will probably spend its way into a first-quarter deficit of 0.5% of GDP ahead of the election, Ms. Orlova said.

Some other economists said Mr. Putin could try to regain popular support with measures intended to attract foreign investment and spur growth.

"Mr. Putin will understand shortly that this system is in crisis and it is necessary to change it," said Sergei Aleksashenko, dean at the Higher School of Economics and a former central banker. "It may be either liberalizing or tightening control of economic policy; previously he believed in tightening."

Mr. Putin's United Russia party claimed less than half of the popular support, although it will keep a majority of seats in the Duma, the Russian lower house. Policy changes will now need to be carefully shepherded through the Duma, said Jacob Nell, economist at Morgan Stanley in Moscow.

Write to William Mauldin at william.mauldin@dowjones.com

December 5, 2011

NATO and Russia Can Defend Togetherhttp://www.nytimes.com/2011/12/06/opinion/nato-and-russia-can-defend-together.html?_r=1&pagewanted=print

By ANDERS FOGH RASMUSSEN

From my first day in office as NATO secretary general, I have made clear that NATO-Russia cooperation remains of strategic importance. We share common security interests and face common challenges. And since our NATO-Russia summit meeting in Lisbon a year ago, we have come a long way in tackling new threats with new thinking.

We are bringing stability to Afghanistan, and stemming the flood of narcotics out of the country — together. We are fighting terrorism in our cities and our airspaces — together. We are combating piracy off the Horn of Africa — together. This cooperation benefits all of us. At Lisbon, we also agreed to discuss pursuing missile defense cooperation.

The missile threat we face is grave and growing. Over 30 states are working on advanced missile technology. Some of them already have ballistic missiles that can be fitted with conventional warheads or with weapons of mass destruction. Some of our major cities are already in range. That is why at the Lisbon summit, NATO agreed to develop a missile defense capability to protect its population, territory and forces. That remains our position today. We owe it to our people to defend them.

Along with a prominent U.S. contribution, a number of allies have made significant announcements, including Turkey, Poland, Romania, Spain, the Netherlands and France. These national contributions will be brought together under a common NATO command and control system. Key elements of it have already been tested successfully. By the time of our summit meeting in Chicago in May, we expect initial components of the system to be in place.

NATO’s system is a strong demonstration of solidarity in action. It also shows the strength of the trans-Atlantic link between North America and Europe. Our 28 nations agree on the significance of the threat and the importance of working together to address it. And by cooperating within NATO, rather than as nations working alone, we deliver a far more effective system at a far lower price.

Our threat perceptions may currently differ, but Russia could also be threatened by ballistic missiles. So it makes sense for us to cooperate in defending against them, by building two separate systems with the same goal. It makes sense practically, militarily and politically. It would show once and for all that we can build security with each other, rather than against each other.

NATO and Russia have held many discussions on missile defense. We have made it clear that our missile defense system is not directed at Russia. It is designed to protect European nations in NATO against threats from outside Europe; it is a defensive system.

Allies and NATO as a whole have made three practical proposals to allay Russian concerns. First, we offered transparency on missile defense programs through exchanges at the NATO-Russia Council, which is our forum for political dialogue, and we issued a standing invitation to Russian experts to observe and analyze missile defense tests. Second, we proposed holding joint NATO-Russia theater missile defense exercises next year. And third, we suggested establishing two joint missile defense centers, one for sharing data and the other for supporting planning.

Russia has also said it needs legal guarantees that NATO missile defenses are not a threat. In fact, when NATO and Russia signed the NATO-Russia Founding Act in 1997, we agreed that we will refrain from the threat or use of force against each other. So the guarantee has been there for over a decade.

Some of President Dmitri Medvedev’s recent comments about NATO’s missile defense system reflect a misunderstanding of the system. As a result, Russia has suggested deploying missiles in areas neighboring the alliance. Such suggestions reflect the rhetoric of the past and are inconsistent with the strategic relationship NATO and Russia agreed to seek. I am, however, pleased that Medvedev has not closed the door on continued dialogue with NATO about missile defense.

Missile defense cooperation can radically change the way NATO and Russia look at each other. In the 21st century, confrontation is not a choice. The only real choice is cooperation.

Anders Fogh Rasmussen is the secretary general of NATO.

Flour and machine guns don’t counthttp://rt.com/politics/press/rossijskaya-gazeta/conference-international-bonn-afghan/en/

Published: 6 December, 2011, 04:25Edited: 6 December, 2011, 04:30

The West holds Russia in Afghan “reception area” Evgeny Shestakov (Bonn)

During the International Conference on Afghanistan in Bonn, Russia’s foreign minister Sergey Lavrov reminded participants about the support Moscow has provided to international military forces since the beginning of the Operation Enduring Freedom.  

In the last 10 years, our country has written off $11 billion of Afghanistan’s debt.

We have supplied 40,000 tons of wheat flour and about $50 million dollars’ worth of non-military equipment to Afghanistan as part of humanitarian aid. Russia has donated a significant amount of small arms and ammunition (20,000 machine guns and 2.5 million rounds of ammunition), and has been providing free training to the Afghan army. Recently, Moscow donated 3,000 tons of wheat flour and 40 trucks to Kabul. It would seem that such an impressive amount of “logistical support” would guarantee that Russia’s voice would be heard in the discussion of regional problems by the Western coalition in Afghanistan. But prior to the Bonn conference, Zamir Kabulov, a special envoy to Afghanistan grimly stated: “Russian proposals usually leave our partners indifferent.”   

Most of Moscow’s initiatives address the practical steps necessary to restore the Afghan economy. “We have declared our readiness to allocate funds to the amount of $500 million for the implementation of the transnational energy project ‘CASA-1000’. We expect our participating partners, Kyrgyzstan, Tajikistan, Afghanistan and Pakistan, to issue a joint address with an invitation to participate in its implementation,” explained Kabulov.   

The West remains wary of all Russian declarations of willingness to cooperate in the construction of a hydro-electric power station and other infrastructure in Afghanistan. Coalition participants, mainly the United States, look at Afghanistan as their personal playground, to which access of “strangers” ought to be closed.

Moscow’s proposals of involving regional international organizations where Russia has a fairly strong presence in the Afghan settlement have been continuously rejected. In the West, we are regarded as merely a transit state, a supplier of humanitarian aid. In his speech in Bonn, Sergey Lavrov once again urged conference participants to reconsider their attitudes toward the Shanghai Cooperation Organization. “In future, this structure could become a high-priority platform for the coordination of international efforts in Afghanistan.” It’s possible that, this time, the Russian foreign minister has been heard.     

On the eve of the conference, Germany's special representative for Afghanistan and Pakistan, Michael Steiner, said that at the Bonn conference “the international community will ensure in a credible way that it will not repeat the mistakes of the past [following 2014]”. What mistakes did the German diplomat have in mind?

In a New York Times article, published before the conference, its authors – influential American experts – argued: “Instead of relying heavily on Pakistan as a supply corridor, the United States should expand its cooperation with Russia, which has been playing an increasingly important role in military transit to and from Afghanistan.” It’s too early to say that “the ice has been broken,” but the initial signs of progress are evident. Collective Security Treaty Organization Secretary General Nikolay Bordyuzha has taken part in the International Conference on Afghanistan for the first time. An invitation to Bonn was also extended to the SCO Secretary General M. Imanaliev.     

Afghanistan’s problems call for the inclusion of qualitatively different players with untainted reputations who enjoy a certain amount of influence in the region. But convincing Washington of the need to replace the players won’t be easy. Before the conference, US officials had made statements regarding the possible continuation of the US military base presence in Afghanistan after the withdrawal of international forces in 2014. Russia considers such actions unjustified. Moscow is urging a complete withdrawal of international forces from Afghanistan and the restoration of the country’s neutral status.    

At the conference in Bonn, the majority of participants urged the Afghan government to engage in a dialogue with political opponents, resolve the problem of drug trafficking, and fight corruption. It was noticeable that Afghan President Hamid Karzai, who sat in his traditional green robe on a podium in the center of the hall, was rather tense when hearing these proposals. “There is a growing understanding of the special role of Afghanistan’s neighbors,” said Lavrov, addressing Karzai in his speech.   

But based on the final outcomes of the conference in Bonn, the settlement process was not smooth, which is typical of such annual meetings. President Hamid Karzai and his ministers were, once again, given a “pass grade” for their work. Russia’s initiatives on the inclusion of the SCO and the CSTO in the Afghan settlement did not make it into the final documents of the Bonn conference.

National Economic Trends

Acting min: Russia’s 2011 budget surplus may exceed 0.5% of GDPhttp://www.prime-tass.com/news/_Acting_min_Russias_2011_budget_surplus_may_exceed_05_of_GDP/0/%7B63DBB176-FCD5-4300-953C-D74ACD9F44C9%7D.uif

MOSCOW, Dec 6 (PRIME) -- Russia’s Finance Ministry believes that the country’s federal budget surplus may exceed 0.5% of the gross domestic product (GDP) in 2011, acting Finance Minister Anton Siluanov said at a briefing late Monday, RIA Novosti reported.

“According to our estimate, the (federal budget) surplus is to amount to 0.5% of GDP, though we’d hoped that it would be even more than that,” Siluanov said.

Siluanov added that in January–September, federal budget incomes were at 8.213 trillion rubles, while budget expenses were at 7.082 trillion rubles. The federal budget surplus in January–September amounted to 1.131 trillion rubles, or 3% of GDP.

Siluanov attributed the federal budget surplus received in January–September primarily to a favorable foreign economic situation and higher oil prices than planned. Consequently, Russia received 2.400 trillion rubles in additional income. Of the total, 340 billion rubles are to be spent in 2011 with the remaining transferred to the Reserve Fund, which is to be increased to 1.800 trillion rubles in 2011.

The assets accumulated in the Reserve Fund would ensure the fulfillment of the country’s 2012 budget obligations, even under a worsened economic situation.

In late November, Siluanov said that Russia’s federal budget surplus is to amount to 0.5% of GDP. The Finance Ministry had earlier revised its forecast for the federal budget surplus to 0.3%–0.4% of GDP in 2011, up from the previously estimated 0.3%.

In 2010, Russia’s federal budget deficit amounted to 3.9% of the country’s GDP.

(30.9068 rubles – U.S. $1)

End

06.12.2011 11:47

Ruble slumps in MICEX trade on S&P warning of eurozone downgradehttp://en.ria.ru/business/20111206/169394215.html

12:15 06/12/2011

MOSCOW, December 6 (RIA Novosti)

The Russian ruble slumped in MICEX trade and Russian stocks were lower on Tuesday in the wake of S&P’s decision to put six leading eurozone economies on the list for possible downgrade.

As of 11:24 a.m. Moscow time (08:24 a.m. GMT), the ruble had fallen by 19 kopeks against the U.S. dollar to 31.0995 and by 0.5 kopecks against the single European currency to 41.5918. The value of the bi-currency basket, comprising $0.55 and 0.45 euros, rose by 13 kopecks to 35.83 rubles compared with Monday’s close.

The dollar-denominated RTS stock exchange lost 1.48 percent to 1,536.14, while the ruble-denominated MICEX fell 0.9 percent to 1,504.18.

International Brent oil prices are hovering at $109.2 per barrel, showing a decrease of 0.6 percent on yesterday’s close.

International ratings agency Standard & Poor's announced late on Monday it had put six leading eurozone economies with the highest AAA rating, including Germany and France, on the list for possible downgrade.

A total of 15 out of 17 eurozone economies were put on the "CreditWatch" list, which means that there is 50 percent possibility that their ratings will be downgraded within 90 days, S&P said.

"Systemic stresses in the eurozone have risen in recent weeks to the extent that they now put downward pressure on the credit standing of the eurozone as a whole," S&P said on its website.

"We now assign a 40 percent probability of a fall in output for the eurozone as a whole," the statement said.

The rating of six eurozone economies with the highest AAA rating - Austria, Finland, France, Germany, Luxembourg and The Netherlands - may be downgraded by one notch and by up to two notches for the other governments.

The eurozone sovereign ratings may be reviewed "as soon as possible" in the wake of the EU summit to take place on December 8-9.

Finance Ministry projects higher capital outflow

http://www.rbcnews.com/free/20111206103912.shtml

      RBC, 06.12.2011, Moscow 10:39:12.Net capital outflow from Russia could exceed $85bn in 2011, acting Finance Minister Anton Siluanov told reporters.

      "The global economy is slowing down, so the capital outflow will be substantial and could come in, according to our estimates, at $80bn or even top $85bn," he said, adding that such results would have a negative impact on Russia's economy. Earlier, the Central Bank of Russia had announced that capital outflow stood at $64bn in 10M 2011.

      Despite the upsurge in capital outflow, Russia's GDP edged up 4.3% in January-September 2011, up from the projected 4.1% growth rate, Siluanov went on to say. By the end of 2011, the GDP growth rate could reach 4.5%, he noted.

Fitch confirms Russia’s BBB ratinghttp://english.ruvr.ru/2011/12/06/61636468.html

Dec 6, 2011 10:49 Moscow Time

The international rating agency Fitch Ratings has confirmed Russia’s BBB rating. According to a statement on Tuesday, the agency  forecasts Russia’s positive outlook at BBB.

The current rating was awarded to this country in September and Fitch experts believe Russia will stay its present economic course.

(RBC)

Poll results will not affect Russia's rating - Fitch http://en.rian.ru/business/20111206/169393319.html

11:51 06/12/2011

MOSCOW, December 6 (RIA Novosti) – The results of Russia’s parliamentary elections, in which the ruling United Russia party fared worse than expected, will not affect the country's investment-grade rating, international rating agency Fitch said.

"The results will not alter our ‘BBB’ rating and positive outlook on the Russian Federation, which Fitch affirmed in September. Russia’s vulnerability to a severe and sustained fall in oil prices and its economic and fiscal performance remain the key possible ratings triggers, as they were in September," the rating agency said in a statement.

Prime Minister Vladimir Putin's party saw a big slump in support at Sunday's polls, with its share of the vote falling from 64% to just under 50%.

Business, Energy or Environmental regulations or discussions

RTS Futures Fall on Europe as Mechel Advances: Russia Overnighthttp://www.businessweek.com/news/2011-12-05/rts-futures-fall-on-europe-as-mechel-advances-russia-overnight.html

December 05, 2011, 11:12 PM EST

By Leon Lazaroff and Halia Pavliva

Dec. 6 (Bloomberg) -- Russian stock futures declined as oil gave up its advance after Standard & Poor’s said Germany and France may be stripped of their AAA credit ratings.

Futures expiring in December on the dollar-denominated RTS index lost 0.7 percent to 154,680 during U.S. trading hours. The Bloomberg Russia-US 14 Index of Russian companies traded in New York added 1.5 percent to 101.39, led by OAO Mechel, Russia’s largest coal producer for steelmakers, after iron ore prices increased.

Crude futures in New York dropped as much as 0.6 percent in after-hours trading today after S&P said it would change the rating outlook for 15 euro nations, including the two largest. Russia, the world’s biggest energy exporter, counts Europe as its top trading partner and the largest market for state-run OAO Gazprom. Companies in the Moscow-based Micex index trade at an average 5.3 times analysts’ profit estimates, the lowest valuation among 21 major emerging markets tracked by Bloomberg.

“Investors collectively remain skeptical about how fixable the problems are in Europe,” said Lewis Kaufman, a Santa Fe, New Mexico-based money manager at Thornburg Investment Management, who oversees the Thornburg Developing World Fund and helps manage $79 billion. “There is relatively good value in a lot of blue-chip Russian stocks but it’s very hard to quantify adverse developments in Europe and what they could mean if things go awry.”

Kaufman’s fund owns shares in OAO Sberbank, Russia’s largest lender, and Yandex NV, the operator of Russia’s most popular Internet search engine.

Brent, Urals Drop

Crude for January delivery on the New York Mercantile Exchange lost 0.5 percent to $100.47 a barrel as of 11:43 a.m. Hong Kong time. Prices are up 9.9 percent this year.

Brent oil for January settlement slid 13 cents to $109.81 on the London-based ICE Futures Europe exchange while Urals crude, Russia’s chief export blend, retreated 0.4 percent to $110.19. Oil and natural gas contribute about 17 percent of Russia’s gross domestic product.

Germany, France, the Netherlands, Austria, Finland and Luxembourg, the euro area’s six AAA rated countries, are among the nations being placed on “CreditWatch negative,” pending the result of a summit of European Union leaders on Dec. 9, S&P said.

S&P’s downgrade warnings come as German Chancellor Angela Merkel and French President Nicolas Sarkozy push for a rewrite of EU cooperation rules that would institute

automatic penalties for deficit violators while locking limits on debt into euro states’ constitutions.

Rusal Declines

The Hong Kong-listed shares of United Co. Rusal, the world’s largest aluminum producer, sank 3 percent to HK$5.52. The MSCI Asia Pacific Index slumped 1.3 percent, the most since Nov. 23.

The RTS Volatility Index, which measures expected swings in the index futures, rose for a second day yesterday, gaining 1.2 percent to 46.08 points. The Market Vectors Russia ETF, a U.S.- traded fund that holds Russian shares, advanced for the first time in three days, adding 1.8 percent to $30.85.

Standard & Poor’s GSCI index of 24 raw materials fell 0.1 percent to 657.52 while copper futures rose to a four-week high. Copper for March delivery climbed 0.9 percent to close at $3.6155 a pound on the Comex in New York.

The Micex has lost 10 percent in 2011, which compares with a 15 percent slide for Brazil’s Bovespa index, which trades at 10.6 times estimated earnings, according to data compiled by Bloomberg. The Shanghai Composite Index trades at 11.1 times estimated earnings, and the BSE India Sensitive Index has a ratio of 14.4.

The Micex, which climbed to a one-month high in Moscow yesterday, is beating all emerging-markets benchmark measures this quarter for indexes in Thailand, Brazil and Hungary, with an increase of 11.1 percent since Sept. 30.

Putin Setback

Russian Premier Vladimir Putin’s United Russia party suffered its first election setback in a Dec. 4 parliamentary vote, winning 49.5 percent compared with 64.3 percent four years ago. Putin, who is seeking to switch jobs next year with President Dmitry Medvedev by running for president, may have to contend with a more fractured legislature than when he was president between 2000 and 2008.

“The results remove uncertainty as to what the government will look like, and allows investors to recognize that for the first time in 15 years, Russian companies are paying shareholders to be shareholders,” said Roland Nash, chief investment strategist at Moscow-based hedge fund Verno Capital, which manages more than $150 million in Russia.

Russian companies including Moscow-based Gazprom are increasing dividends to attract investors while OAO GMK Norilsk Nickel has bought back shares, signs that Russia’s companies are responding to international money managers’ demands to improve corporate governance, Nash said.

VimpelCom

VimpelCom Ltd., the Russian mobile-phone operator with more than 200 million subscribers worldwide, rose 2.3 percent to $11.81 in New York after UralSib Financial Corp. reiterated its “buy” recommendation on the stock.

“Investors have an opportunity to enter VimpelCom at fundamentally attractive levels,” UralSib analysts, including Konstantin Chernyshev, Konstantin Belov and Nikolay Dyachkov said in the report. “Growth in both mobile and fixed-line broadband is set to become the company’s key growth driver in established markets. We expect 8 percent per annum average organic sales growth in 2012 and 2013.”

VimpelCom said Jon Fredrik Baksaas, president and chief executive officer of Telenor Group, will replace Jan Edvard Thygesen on its supervisory board, according to a statement filed yesterday.

Mechel’s American depositary receipts advanced 5.6 percent to $11.74 after shares in Moscow gained 3.5 percent 354.90 rubles, or the equivalent of $11.49. One ADR represents one ordinary share.

Yandex, CTC

Yandex NV increased 0.6 percent to close at $21.48 in New York after UralSib raised its recommendation on the stock to “buy” from “hold,” the bank said in an e-mailed report yesterday.

“Yandex has good exposure to the rapidly growing Russian online advertising market, which we expect to expand,” UralSib analysts said in the report. “Russia is the only country in Europe where Google lags the local player in search. Yandex should be the main beneficiary from internet penetration growth in the regions.”

CTC Media Inc., the Russian television network listed in the U.S., gained 1 percent to $10.06 in New York after UlraSib maintained its “buy” rating on the stock.

--With assistance from Darren Boey in Hong Kong. Editors: Marie- France Han, Laura Zelenko

To contact the reporters on this story: Leon Lazaroff in New York at llazaroff@bloomberg.net; Halia Pavliva in New York at hpavliva@bloomberg.net

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

December 06, 2011 09:06

Russia to reduce power equipment import duties under WTO obligationshttp://www.interfax.com/newsinf.asp?id=292741

MOSCOW. Dec 6 (Interfax) - Russia will reduce import duties on certain types of power equipment in 2013-2015 as part of its obligations upon joining the World Trade Organization.

The country will begin lowering duties on gas turbines with capacity of 20 MW to 50 MW in 2013, and on turbines with capacity up to 20 MW in 2014, according to a document on Russia's obligations concerning access to goods markets upon accession to the WTO, of which Interfax has obtained a copy. Duties on gas turbines with capacity over 50 MW will not be lowered. Furthermore, the cap rates for all types of gas turbines upon accession to the WTO, which is expected to take place by the middle of 2012, will exceed the current duties.

Gas turbines, capacity

Prior to joining, %

Upon joining (cap rate), % 2013, % 2014, % 2015,%

Up to 5 MW 8 10 8.8 7.5 -5 MW to 20 MW 8 10 8.3 6.7 520 MW to 50 MW 8 10 7.7 5.3 3Over 50 MW 10 15 - - -

Duties on hydraulic turbines will begin to be lowered in 2013, and will reach the minimum of 13% in 2014 for all categories.

Hydraulic turbines, capacity Prior to joining, % Upon joining, % 2013, % 2014,%From 1 MW to 10 MW 15 15 14 13Over 10 MW 15 15 14 13

The import duty on steam turbines will not be lowered. Moreover, Russia reserves the right to raise it from the current 15% to 20% in the period to 2016, though after 2016 it is not supposed to exceed 15%.

Russia also reserves the right to impose a 5% duty on turbine generators and wind generators, which are currently not subject to import duties.

Russia will begin lowering duties in 2013 on a range of transformer equipment, which will reach their minimum level in 2016-2017.

Transformers (not used in civil aviation),

Prior to joining,

Upon joining,

2013, %

2014,% 2015,% 2016, %

2017, %

electrical capacity % %Up to kVA 20 20 17.6 15.2 12.8 10.4 81 kVA to 16 kVA Metering 15 15 14 13 12 - -

Other 15 15 13.1 11.3 9.4 7.5 -16 kVA to 500 kVA 15 15 13.1 11.3 9.4 7.5 -Over 500 kVA 15 15 13.5 12 10.5 9 -

In many cases, import duties on transformers will be slashed by approximately half, though the ceiling for import duties on transformers upon accession to the WTO in most cases does not differ from the current rates.

Liquid-filled transformers, electrical capacity

Prior to joining, %

Upon joining, %

2013, % 2014,% 2015,

%2016, %

2017, %

Up to 650 kVA 15 15 12.7 10.3 8 7.5 -650 kVA to 1600 kVA 15 15 12.7 10.3 8 - -1600 kVA to 10000 kVA 10 13 10.5 8 - - -Over 10000 10 10 9 8 - - -

Import duties on boiler equipment will begin to be reduced in 2015 and reach their minimum in 2016. There will be an exception for water boilers with superheaters, the duty on which is currently zero, but after accession to the WTO can be up to 5%.

Boilers (not for ship equipment):

Prior to joining, %

Upon joining, %

2013, % 2014,% 2015,

%2016, %

Water pipe Productivity 45 t of steam/hr 10 15 13.1 11.3 9.4 7.5

Flue 10 15 12.5 10 7.5 5Water with steam superheater 0 5 - - - -

Other steam boilers, including combined 10 15 12.5 10 7.5 5

Central heating 15 15 13.3 11.7 10 -

Russia's leading manufacturers of turbine equipment are OJSC Power Machines (steam, gas, hydraulic), OJSC Saturn Gas Turbines, OJSC Tyazhmash (hydraulic), the Renova Group's CJSC Ural Turbine Plant (steam) and CJSC Neva Plant (steam). The country's biggest producer of boiler equipment is OJSC EMAlyans.

The largest producers of transformers are LLC Togliatti Transformer and OJSC Sverdlovsk Current Transformer Plant.

The biggest importers of power equipment are Siemens, Alstom, General Electric and Mitsubishi Heavy Industries.

The proportion of imported primary equipment at Russian power plants is now about 80%. It was during debates over imports of power equipment that Prime Minister Vladimir Putin made his harshest statements on issues concerning the WTO in the past year. At a meeting in April, he criticized Deputy Economic Development Minister Andrei Klepach, who said duties on power equipment could not be raised due to obligations within the context of WTO negotiations.

"We should fulfill obligations, bear certain expenses without getting any of the advantages of membership which does not exist. As soon as we start fulfilling WTO obligations without being a member they, our partners, will lose any wish to adopt us. Why the hell should they admit us, if we already observe everything," Putin said.

"Why are we constantly returning to this? We will introduce all the rules and restrictions after full accession. Before that we have our hands free. We have said it a thousand times but you return us back there again," he said in reaction to Klepach's remark that Russia has its hands tied as far as duties are concerned given its upcoming accession to WTO, and spoke of the need for antidumping measures in power industry equipment manufacturing.

vp ml of

(Our editorial staff can be reached at eng.editors@interfax.ru)

MICEX-RTS to liberalize forex market

http://www.rbcnews.com/free/20111206103209.shtml

      RBC, 06.12.2011, Moscow 10:32:09.The merged MICEX-RTS stock exchange intends to provide direct access to foreign exchange trading to companies by December 2012, RBC Daily reported today.

      Companies are currently required to trade on the forex market via banks. Under the law on organized trading passed in November, companies' treasuries will be allowed to carry out transactions via MICEX-RTS' authorized bank, the National Clearing Center, starting December 1, 2012.

Merged Bourse Mulls Future 06 December 2011Vedomosti

The combined MICEX-RTS stock exchange will need a bigger office and a more powerful data center, MICEX president Ruben Aganbegyan told Vedomosti.

Neither of the existing offices, on Ulitsa Vozdvizhenka and Bolshoi Kislovsky Pereulok, is suitable for all the employees. The question whether to rent or buy a new facility, and where it should be located, is currently under discussion, Aganbegyan said.

A new data center could also be needed. “We are even now offering services around placing servers of the exchanges and market players in one facility. The services are very much in demand, and we understand that there will be even more demand and our current option might not suffice,” Aganbegyan said.

There is an idea about building a new data center, Aganbegyan said, but no final decisions have been made.

Read more: http://www.themoscowtimes.com/business/article/merged-bourse-mulls-future/449282.html#ixzz1fk3SxDZW The Moscow Times

Uranium One sets terms for Russian bond offerhttp://ca.reuters.com/article/businessNews/idCATRE7B41G220111205

Mon Dec 5, 2011 11:28am EST

TORONTO (Reuters) - Canadian miner Uranium One said on Monday it had negotiated the commercial terms for a five-year Russian bond offering worth $463.5 million.

The ruble-denominated bonds, which will be the first to be issued by a foreign-listed company in the post-communist Russian Federation, will be traded on Russia's MICEX exchange. The interest rate is set at 6.74 percent, payable semi-annually from the date of issue.

Shares of Uranium One were up 3.38 percent at C$2.45 on Monday morning on the Toronto Stock Exchange.

Last month, Uranium One registered a prospectus with Russian securities regulators for a bond offering valued at up to $950 million.

The Toronto-based uranium producer is developing the Mkuju River uranium project in Tanzania, which it has the option to buy from its majority shareholder, JSC Atomredmetzoloto (ARMZ) for about $1 billion.

Uranium One, which owns projects in Kazakhstan, Australia and the United States, is 51.4 percent owned by ARMZ, a division of Russia's state-owned nuclear giant Rosatom.

(Reporting by Julie Gordon; Editing by Peter Galloway)

MRSK London Listing for Future Fund Raising 06 December 2011Reuters

Power grid company MRSK is scheduled to list its shares in London this week, a move it hopes will boost the liquidity of its stock and enable it to raise funds in the future, a company spokesperson said.

The technical listing, in which no money is raised, will see MRSK list 25 percent of its stock as global depositary receipts — the maximum allowed under Russian securities regulations — on Thursday.

The federal government owns a more than 50 percent controlling stake in MRSK, while state-controlled Gazprom has 10 percent.

MRSK was judged by analysts to be the power group worst affected by the government's u-turn on proposed household electricity tariff rises earlier this year. The company is a holding group for several local electricity distribution grids.

Its shares are down 47.5 percent this year, valuing it at about $4 billion, while Russia's RTS Electric Utilities Index is down 29 percent.

The company was expected to receive more share price support from its recent inclusion in the MSCI Russia Index, which is used by emerging market investors worldwide to track Russian shares.

MRSK chief executive Nikolai Shvets said in October the company was preparing to hold a technical London listing of up to 25 percent of its shares in December.

The move was aimed at getting greater investor exposure ahead of a possible privatization after President Dmitry Medvedev said in March it might make sense to further privatize MRSK to boost efficiency in the power sector.

Rival state-controlled grid firm FSK completed the listing of its secondary shares in London at the end of March.

A wave of Russian companies have recently sought premium listings of their shares, with some large enough to seek inclusion in the FTSE-100 Index.

Mining companies Polymetal and Evraz recently started trading as premium companies. Russian potash miner Uralkali has also said it is considering a full stock market listing in London next year.

Read more: http://www.themoscowtimes.com/business/article/mrsk-london-listing-for-future-fund-raising/449288.html#ixzz1fjW0oith The Moscow Times

Yandex to go international

http://www.bne.eu/dispatch_text18172

bneDecember 6, 2011

Russia’s internet search engine Yandex will move into non-Russian language markets in 2012, company General Director Ardkady Volozh said at a conference in Moscow December 5, reports Interfax.

According to Volozh, there are currently only three internationally search engines, and in many countries in South America, Southern Europe, and Asia Google has an effective monopoly. "We see these markets as natural niches for us," Volozh said, according to Interfax. "The appearance of a second search engine will lead to some market redistribution," he added.

Volozh said the Turkish market would serve as a test case for Yandex to go international. "In six months to a year, it will be possible to announce some results of entering foreign markets," he said. "Then it will be possible to make specific plans for moving onto other markets," he said. Yandex already started expansion into Turkey in September 2011. According to Interfax sources, Poland is also an interesting prospect.

Yandex IPO-d on the Nasdaq in May 2011, raising a warchest of $1.43bn to fund further expansion and support competition with Google.

Citigroup Bemoans Liquidity 06 December 2011

Citigroup Russia sees a tightening of liquidity in the domestic banking sector, according to the lender's consumer-banking head.

"There is a very distinct and clear tightening of liquidity in this market right now, which is why we have seen deposit rates go up and you have seen wholesale funding drying up," Citigroup's Amit Sah said in an interview in Moscow last week.

The Central Bank left the refinancing rate at 8.25 percent on Nov. 25 after two increases this year. Tighter lending conditions and a liquidity shortfall will likely "remain for the medium term," the bank said.

Russian units of foreign banks, including UniCredit, have started lending excess cash to their parents since the middle of the year amid the euro region's turmoil, using "Central Bank liquidity" and funds from their Russian operations, Deputy Economy Minister Andrei Klepach said Oct. 27.

Citigroup, which set up its retail entity in Moscow in 1993, doesn't have funding pressure from its parent bank, Sah said. The bank is likely to raise rates soon in line with interest rates, he added, without providing further details.

(Bloomberg)

Read more: http://www.themoscowtimes.com/business/article/citigroup-bemoans-liquidity/449323.html#ixzz1fjLEQTgJ The Moscow Times

Sberbank Bids for National 06 December 2011

A joint venture between Deutsche Bank and Russia's largest lender, Sberbank, will be one of the bidders for the $149 million National Hotel opposite the Kremlin, Kommersant reported Monday.

DB Development, as the vehicle for Sberbank and Deutsche Bank is known, will face rival bids from France's Accor, South Korea's Lotte and billionaire Suleiman Kerimov through Nafta Moskva.

The 201-room National Hotel on prime real estate next to Red Square is to be sold by the Moscow city government along with some of the contents, which include tsarist antiques that belonged to Russia's imperial family. Bidding begins Dec. 19.

(MT)

Read more: http://www.themoscowtimes.com/business/article/sberbank-bids-for-national/449279.html#ixzz1fjLI1ZCJ The Moscow Times

Mail.ru Moving to Tower 06 December 2011

Hals-Development and Mail.ru Group have signed a long-term lease agreement to provide the technology company with 29,932 square meters in the Hals SkyLight business center on Leningradsky Prospekt in Moscow.

Mail.ru will occupy one of the two 27-story towers at the site, according to a statement released by Cushman & Wakefield, which advised the deal.  This is the largest office lease transaction in Moscow in 2011, the statement said. The company expects the new office to be functioning by February 2013.

(MT)

Read more: http://www.themoscowtimes.com/business/article/mailru-moving-to-tower/449280.html#ixzz1fjTnAGCv The Moscow Times

Strabag Q3 Up 3% 06 December 2011

Strabag, Austria's biggest builder, whose main focus is Eastern Europe and has significant operations in Russia, said net income in the third quarter rose 3 percent to 123 million euros ($164 million). The company reiterated it expects full-year net income at 185 million euros.

(Bloomberg)

Read more: http://www.themoscowtimes.com/business/article/strabag-q3-up-

3/449283.html#ixzz1fjL6Bri9 The Moscow Times

Activity in the Oil and Gas sector (including regulatory)

December 06, 2011 10:40Rosneft board of directors to consider increasing capital in JV with CNPChttp://www.interfax.com/news.asp

Dec. 5, 2011, 3:16 p.m. EST

U.S. demand for Russian ESPO crude falls in Nov.http://www.marketwatch.com/story/us-demand-for-russian-espo-crude-falls-in-nov-2011-12-05?reflink=MW_news_stmp

By Jacob Gronholt-Pedersen

MOSCOW (MarketWatch) -- The U.S. was the biggest buyer of Russia's ESPO crude in the first 11 months of 2011, but shipments fell drastically in November as U.S. refiners are looking for alternatives in order to meet new low-emissions regulations.

U.S. refiners bought 200,000 metric tons of Russian ESPO crude in November, considerably down from 500,000 tons and 400,000 tons respectively in the two previous months, data from Russia's Kozmino port, operated by OAO Transneft , showed Monday.

The ESPO blend is a light sour Russian crude supplied to Asia-Pacific and the U.S. west coast through the East Siberia-Pacific Ocean, or ESPO, pipeline and exported from the port of Kozmino on Russia's Pacific coast since December 2009. It is considered to be a good optimization crude, which can easily be blended with other crudes in order to maximize yields on certain oil products.

"It looks like U.S. demand may be tampered in the future by the introduction of a new carbon law in California, which will make processing ESPO uneconomical compared to Middle Eastern crudes," said an employee in sales, trading and logistics at Anglo-Russian oil joint venture TNK-BP Ltd., who asked not to be named.

U.S. refiners were the biggest buyers of ESPO crude so far this year, taking 28% of total volumes, or 3.80 million tons. In comparison, Japan bought 2.64 million tons, with China taking 2.40 million tons, South Korea 1.6 million and the Philippines taking 1.27 million tons. The remaining volumes went to Thailand, Singapore, Peru, Indonesia and India.

The Asia-Pacific region is expected to remain the main market for the crude, as demand for middle distillates will stay strong.

"Asia-Pacific will still stay the predominant market for ESPO, especially taking into account that there's plenty of upgrading capacity coming on stream in Asia, which will make processing ESPO even more attractive for these refineries," the TNK-BP employee said.

A total of 11 tankers, each holding 100,000 tons of ESPO crude, shipped out of Kozmino in November. Five went to China, two to the U.S. and the rest to South Korea, Japan, Peru and the Philippines, the data showed.

Kozmino plans to load 13 tankers in December, bringing volumes for the year to slightly over 15 million tons, a spokeswoman at the port said.

The second stage of the ESPO pipeline may be put into service more than a year ahead of plan by end-2012. Once the second part, from Skovorodino to Kozmino, is finished, capacity to the Pacific coast will increase to 30 million tons a year.

Alliance Oil Company May Get Russian Tax Break, Kommersant Sayshttp://www.bloomberg.com/news/2011-12-06/alliance-oil-company-may-get-russian-tax-break-kommersant-says.html

By Yuliya Fedorinova - Dec 6, 2011 8:15 AM GMT+0400

Alliance Oil Company Ltd. may get 4.5 billion rubles ($146 million) of compensation from the government next year after Russia adopted a new oil tax regime, Kommersant reported today.

The company plans to apply to the government after OAO Bashneft and OAO Tatneft got the right for the compensation, the Moscow-based newspaper said, citing people in Alliance it didn’t identify.

To contact the reporter on this story: Yuliya Fedorinova in Moscow at yfedorinova@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

December 06, 2011 12:39

Alliance Oil to request tax discounts under 60/66 systemhttp://www.interfax.com/newsinf.asp?id=292814

MOSCOW. Dec 6 (Interfax) - Alliance Oil Company plans to appeal to the government by the end of this year for compensation for reduced income from export duties introduced under the new 60/66 system, a source close to the company told Interfax.

Alliance Oil estimates that it will lose around 4.5 billion rubles in income under the new system, the source said.

The company will register reduced income until it completes the second stage of the Khabarovsk oil refinery's reconstruction, scheduled for Q1-Q2 2013.

Alliance Oil is considering several compensatory options - a discounted railway tariff on oil shipments, discounts on connecting the Khabarovsk refinery to the main Eastern Siberia-Pacific Ocean (ESPO) pipeline and on pumping oil through ESPO, or other discounts that would allow the company to lower the cost of raw materials for processing at Khabarovsk, the source said.

Based on the company's estimate, the cost of directing oil from the Khabarovsk refinery to ESPO could total 3-3.5 billion rubles.

In November, Russia's State Duma adopted an amendment to the tax code providing for deductions on the natural resources extraction tax (NRET) for Tatneft (RTS: TATN) and Bashneft (RTS: BANE) under the new 60/66 system. The amendments provide Tatneft with a deduction from 2012-2016, and Bashneft from 2012-2015.

Eb

(Our editorial staff can be reached at eng.editors@interfax.ru)

TNK-BP Wants More in Vietnam 06 December 2011Reuters

TNK-BP, currently developing a gas project in Vietnam acquired from its major shareholder BP, has also bid for ConocoPhillips assets in the Asian country, TNK-BP's head of upstream operations Alexander Dodds said Monday.

"We did put a bid in," Dodds told a news briefing in response to a question.

TNK-BP, a 50-50 joint venture between BP and a quartet of Soviet-born businessmen, has already taken over some gas assets in the South China Sea from its British co-owner and expressed its interest in expanding in Vietnam.

It has said it will bid for one block of nine blocks on offer by the Vietnamese government in a tender that opens this week. State oil and gas group Petrovietnam has already said it will bid for the ConocoPhillips assets, which are located further north in the South China Sea.

TNK-BP management has board approval to pursue operations in three countries outside the former Soviet Union: Vietnam and Venezuela, where it bought assets from BP as it sold down its portfolio to pay damages for the Macondo disaster; and Brazil, where it bought into an exploration business.

Read more: http://www.themoscowtimes.com/business/article/tnk-bp-wants-more-in-vietnam/449289.html#ixzz1fjVliV85 The Moscow Times

DECEMBER 6, 2011

Russian Oil Frontier: Nowhere Land http://online.wsj.com/article/SB10001424052970203764804577060200073674124.html

Energy Firms, in Remotest Siberia for Crude, Run Rigs Over Video Link From 700 Miles AwayBy GUY CHAZAN

EASTERN SIBERIA, Russia—There's the middle of nowhere, and then there's here.

The place is Verkhnechonsk, an oil field in eastern Russia operated by TNK-BP Ltd. that is one of the remotest spots on the planet. To get there you have to fly to Siberia, take an aging turboprop plane deep into the taiga, or subarctic forest. Then hop on a helicopter heading north. From Moscow, the journey takes a day, including layovers—longer if there are snowstorms.

It is so far from anywhere that TNK-BP, a joint venture of BP PLC and a group of Soviet-born billionaires, runs operations via video link from an office in Irkutsk, some

600 miles away. "It's like living on an island," says Albert Gilfanov, the oil field's deputy manager.

Russia is an energy superpower, with 13% of the planet's oil resources and a quarter of its natural gas. Having declined steeply after the collapse of the Soviet Union, oil production has come back strongly, hitting a new post-Soviet high of 10.3 million barrels a day in October.

Yet the mainstay of Russia's hydrocarbon wealth—the big Soviet-era oil fields of Western Siberia—is in decline. To keep production stable, Russia has no choice but to expand into new areas like Eastern Siberia—where oil reserves are less plentiful, production costs higher and the logistical challenges mind-boggling.

Some companies are already there. TNK-BP has been pumping crude from Verkhnechonsk, one of the biggest oil fields in Eastern Siberia, since 2008.

But the difficulties it faces are enormous. The cold is staggering, even for Siberia: winter temperatures can fall to -70 Fahrenheit, at which point all outside work is banned. The nearest human settlement is 250 miles away, and the forests are full of bears, wolves and elks. The oil is stuck under layers of hard rock and salt deposits that make drilling difficult.

And perhaps worst of all, the size of the prize is far from inspiring. All of Eastern Siberia contains five billion barrels of proven oil reserves, according to the International Energy Agency, compared with Western Siberia's 48 billion barrels.

Russia's other prospective areas are even more remote and even more expensive to develop: according to one estimate, $500 billion will be needed to open up vast oil and gas fields in the offshore Arctic. The costs of producing oil in Eastern Siberia and other far-flung areas are high—between $6 and $10 a barrel, compared with $4-$8 a barrel in Russia's older oil provinces, according to the IEA. Although crude from Eastern Siberia sells for over $100 a barrel, capital and transport costs take a big chunk out of profits.

And under Russia's current tax system there is little incentive to invest. For example, the Russian government's take from one of its new fields in the Arctic—the total effect of the country's fiscal system on cash flow from the fields—is 72%, compared with 53% for one of Brazil's massive offshore oil fields, according to Morgan Stanley. "For these projects to be successful...there needs to be some significant changes to the fiscal regime," Glen Waller, head of Russia for Exxon Mobil Corp., told a recent conference in Moscow.

Yet Russia's rulers are so heavily dependent on the money they get from the oil companies that they are loathe to reduce taxes. Revenues from oil and gas make up almost half of Russia's budget income.

The IEA projects that Russian oil output will stabilize for the next few years and then go into a slight decline, as output from new fields fails to compensate for declines in the older ones.

But the key to keeping Russian oil production more-or-less stable, according to the IEA, is to maintain or even increase output from Russia's core region of Western Siberia, which still contains billions of barrels of oil. That could be done by restructuring the tax system so as to encourage investment in its new fields and through enhanced recovery techniques at old ones. If that investment isn't forthcoming, total Russian oil production could go into "a rapid decline," the IEA says.

Verkhnechonsk was first discovered in 1978 by Soviet geologists. But it was considered too far away from the U.S.S.R.'s export markets to be worth developing.

That changed in 2006 when Moscow started building the East Siberia-Pacific Ocean pipeline, known as ESPO—a multibillion-dollar project designed to bring Siberian oil to Asia. Suddenly, marooned oil fields like Verkhnechonsk had an outlet to the fast-growing energy markets of the East.

The Russian government also helped by making crude from Eastern Siberia exempt from mineral-extraction tax, at least initially, and oil-export duties. Armed with the tax breaks, TNK-BP set to work.

Mr. Gilfanov, the oil field's deputy manager, was one of the first men to be deployed to Verkhnechonsk. He was sent here in 2007 from Samotlor, an oil field in Western Siberia that is one of the largest in the world and where he worked for 30 years.

Mr. Gilfanov says Verkhnechonsk has the same feel Samotlor had when he arrived there in 1979 as an idealistic young communist. "There was nothing here when I came, just taiga," he said, referring to the swampy coniferous forest that covers the area. "I was a pioneer again."

Conditions were tough. Workers shivered in winter and in summer were tormented by midges so vicious they have been known to kill cows. With no roads, the oil men had to be flown in by helicopter from Ust Kut, a desolate Siberian way station that Bolshevik leader Leon Trotsky was exiled to in Czarist times.

The oil field itself, with its complex geology and even more complex chemistry, didn't make things easier. TNK-BP engineers soon discovered that the oil in the reservoir was incredibly cold. That increases the risk of wax building up in the wellbore—the hole created by the drill bit—blocking the well and slowing the oil's flow rate. It also means the oil has to be heated up when it comes out of the ground so water and salts can be removed—a process that requires huge amounts of energy.

"Verkhnechonsk has some of the lowest temperatures among any of the world's oil fields," says Igor Rustamov, head of the Verkhnechonsk production subsidiary.

Also, the oil has an unusually high salt content. Cleaning that requires a lot of fresh water, which is in short supply in the ice-bound taiga. Meanwhile, hard-to-remove salt deposits can build up in pipes, pumps and valves.

Finally, the part of Verkhnechonsk's reservoir that actually contains producible oil—the pay zone, as it is called—is unusually thin. So TNK-BP had to drill horizontal rather than vertical wells, using advanced technologies to guide the drill bit toward the reservoir's sweet spot—"like an optical sight on a sniper's rifle," says Mr. Rustamov.

There have been other problems. The Russian government, noting the steep rise in oil prices, canceled the zero oil-export duty in July 2010, half a year earlier than planned. "Of course it was a blow," says Jonathan Kollek, the company's head of supply, trading and logistics. "The industry needs predictability to plan investments efficiently."

TNK-BP finally delivered Verkhnechonsk's first oil into the ESPO pipeline in October 2008, a landmark event. Production is expected to increase to a peak of 160,000 barrels a day by 2014, from roughly 100,000 barrels a day now.

But that pales in significance compared with the monster fields of Western Siberia. Samotlor reached peak production of more than three million barrels a day in 1980. Even now, 46 years after it opened, it is producing five times more than Verkhnechonsk.

"East Siberia just doesn't have the same reserves," said Mr. Rustamov. "In that respect, West Siberia is irreplaceable."

Write to Guy Chazan at guy.chazan@wsj.com

Gazprom

Gazprom says Ukraine can now pay for supplies in roubleshttp://af.reuters.com/article/energyOilNews/idAFR4E7MG00320111205

Mon Dec 5, 2011 5:04pm GMT

MOSCOW Dec 5 (Reuters) - Russian energy giant Gazprom on Monday said it signed an agreement with Naftogaz under which the Ukrainian state energy company will be able to pay for supplies in Russian roubles.

"(The contract) amendment allows 'Naftogaz of Ukraine' to pay for supplies of Russian gas in roubles as well," the statement said.

The two sides, which are frequently at odds over pricing and volumes, reached a preliminary agreement on the matter last month.

Ukraine relies heavily on Russian gas for its energy needs and Naftogaz pays between $500 million and $1 billion a month for the imports, contributing to depreciation pressure on the hryvnia. (Reporting By Alfred Kueppers)

Gazprom CEO: Ukraine and Russia will probably seal natgas deal in 2011http://www.ukrainianjournal.com/index.php?w=article&id=13634

Journal Staff Report

KIEV, Dec. 5 – Ukraine and Russia will “probably” conclude an agreement by the end of the month to lower natural gas prices, Russian gas giant Gazprom said in a statement on Monday.

Gazprom issued the satement following talks between Gazprom CEO Alexei Miller and Ukrainian Energy and Cal Industry Ministry Yuriy Boyko in Moscow.

“A single opinion has been expressed that the talks over Russian gas supplies to Ukraine will probably be concluded before the end of the year 2011,” the statement said.

Gazprom and Naftogaz Ukrayiny also signed an agreement allowing the Ukrainian company to make payments for natural gas supplies in rubles, the Russian currency, as opposed to U.S. dollars.

Ukraine says to conclude Russia gas talks in DecTue Dec 6, 2011 8:17am GMT

KIEV Dec 6 (Reuters) - Ukraine and Russia will finalise a new gas deal before the end of this month, Ukraine's Energy Ministry said in a statement late on Monday, a message indicating Kiev was likely to secure a long-coveted gas price discount.

The deadline was set at a meeting between Ukrainian Energy Minister Yuri Boiko and the head of Russian gas giant Gazprom Alexei Miller in Moscow, it said.

Ukraine, which relies heavily on Russian gas imports and pays about $400 per thousand cubic metres, says the price is too high and has been trying to renegotiate the supply contract for over a year.

Price disputes between the two ex-Soviet nations have in the past disrupted Gazprom's supplies to Europe through Ukraine.

Kiev and Moscow announced significant progress after a meeting of presidents Viktor Yanukovich and Dmitry Medvedev in September and have since said they were working on implementing agreements they had reached, without providing any details.

"The sides have agreed to complete the drafting of agreements reached by the two countries' leadership on expanding cooperation in the gas sector before the end of December 2011," the Ukrainian ministry said.

Analysts say that in order to secure a discount, Ukraine is most likely to offer Russia a stake in its pipeline system which Gazprom sees as a key to safeguarding its European supplies. (Reporting by Olzhas Auyezov, editing by William Hardy)

Gazprom fails to sign gas agreement with Moldova --- marginally negative

http://www.bne.eu/dispatch_text18172

VTB CapitalDecember 6, 2011

News: According to RBC-Daily, Gazprom has failed to negotiate a new gas contract with Moldova on common terms applicable to the majority of the company’s other European supply contracts. The paper quoted Vladimir Filat, the Prime Minister of Moldova, as saying that Gazprom had suggested discounted gas prices in exchange for Moldova foregoing the rules and regulations of the third energy package. The sides failed to reach agreement on the matter. Gazprom’s representatives refused to comment.

Our View: As Moldova represents less than 1% of Gazprom’s sales volumes, this failure to negotiate a new gas agreement is immaterial for the company. However, this is another link in the chain of bad news over gas negotiations in Europe, so it might be marginally negative for sentiment. To recap, the third energy package stipulates that one company cannot operate both gas supplies and transportation at the same time (which is the case for many of Gazprom’s operations).

11:23Gazprom names special overseer for relations with Brusselshttp://www.interfax.com/news.asp

Russia in WTO: Gas Dispute In Europe Could Find New Venue http://www.themoscowtimes.com/news/article/russia-in-wto-gas-dispute-in-europe-could-find-new-venue/449295.html

06 December 2011By Howard Amos

While Russia's expected accession to the World Trade Organization in 2012 could be used in a brewing struggle between Gazprom and the European Union, the move is unlikely to have a big impact on the country's domestic gas industry or export revenues.

"Broadly speaking everything will stay as it was," said Artyom Kochin, an oil and gas analyst at UniCredit Securities.

Gazprom increased production by 12 billion cubic meters in 2012 to 520 bcm, and profits from energy exports have grown to about 40 percent of federal revenue. WTO entry will do little to upset these trends.

But membership of the international trade body could provide state gas export monopoly Gazprom with another weapon as it battles the European Union's third energy packet. The EU measures that could begin to be implemented next year seek to separate production from supply and break up Gazprom's control of continental pipelines.

Asked about the EU's plans, Russia's chief WTO negotiator Maxim Medvedkov said last month that there was a "very big question over whether they are compatible with the obligations of our partners in the WTO."

EU diplomats have stated repeatedly that the third energy package does not contravene WTO rules and that the issue should be decided in bilateral talks.

Whatever the political consequences for Gazprom, Russia's export tariffs and internal gas prices are unlikely to be seriously affected. The country will retain its ability to set pricing formulas for the "indefinite future," Medvedkov said. Long-term gas contracts with European customers are linked to the oil price.

While WTO entry conditions permit the Kremlin to maintain the regulation of domestic gas prices for households and noncommercial users, they are obliged to introduce market prices for gas to industrial enterprises.

This will occur gradually, said Alexander Kirevnin, an oil and gas analyst at VTB Capital, as the state will not allow Gazprom to raise domestic gas prices by more than 15 percent a year.

He added that VTB Capital had not changed its valuation models for either Gazprom or independent producer Novatek following the news of likely WTO accession.

A Gazprom spokesman declined to comment. "At the present moment, we won't comment on this and will not even look into it," he told The Moscow Times. Novatek did not respond to repeated telephone and e-mail requests for comment.

But gas producers may be influenced from another quarter. The Russia director of a U.S. oil and gas services company whose clients include Gazprom told The Moscow Times that WTO accession was likely to level the playing field as far as service companies were concerned.

"It's a good thing, whether they know it or not, for Russian [gas] producers," said the executive who requested anonymity to speak freely. "As an industry, they will have to finally become more efficient, productive and usable."

Read more: http://www.themoscowtimes.com/news/article/russia-in-wto-gas-dispute-in-europe-could-find-new-venue/449295.html#ixzz1fjUCm1E3 The Moscow Times