Gas Games in Central Asia

This week’s announce­ment that the three Central Asian gas pro­ducers - Turkmenistan, Uzbekistan and Kazakhstan - will begin charging European ­level prices for their gas starting next year was hardly unexpected, but it produced a bomb-like effect nonethe­less.

The heads of the three national oil and gas companies came to Moscow where they held a meeting with Gazprom CEO Alexei Miller. This too was a departure from old traditions where the next year’s price of gas was a commercial secret discussed in closely-guarded bilateral meetings. Following this meeting, however, Gazprom’s press service issued a press release that said: “Based on the inter­ests of national economies and taking into account international obligations to guarantee reliable and uninterrupt­ed deliveries of energy resources, start­ing in 2009 Central Asian countries will sell their natural gas for European prices.”

Although even the price formula for the Central Asian gas deliveries has not been determined yet, experts agree that in 2009 Gazprom will have to pay any­where from $230 to $300 for 1,000 cubic meters of gas, depending on many variables. This year the Russian gas monopoly is paying between $140 and $180 for 1,000 cubic meters, depending on the country of origin and previous agreements.

The game for Central Asian gas has several major players. This week’s announcement has marked some clear winners and losers in this round of the game, but the outcome is still largely undecided.

The dear winners of this story who will reap the rewards no matter what are the three Central Asian states who have already been labeled by the Russian media as the “Asian gas OPEC.” By getting Gazprom to agree to raise the purchase price of their gas, Turkmenistan, Uzbekistan and Ka­zakhstan have secured a good price from a long-term partner, while simul­taneously making a polite nod in the direction of Washington and Brussels, whose envoys have long tried to lure their leaders with European prices and projects to build gas pipelines bypass­ing Russia.

Ukraine seems the likeliest loser at the moment, because it is now unable to hold separate negotiations for the Central Asian gas. It can either buy gas from Turkmenistan via Gazprom or turn its sights elsewhere, but the price it will have to pay next yearwill be high, and it is yet unclear how its gas­dependent industrial sector will react to the shock therapy. Ukraine does, however, have some leverage over Gazprom and that is the gas transit tar­iffs which are not kept significantly lower than average European ones. Raised tariffs might set the Russian gas monopoly $1-1.5 billion back. At the same time Gazprom has the same leverage against the Central Asian states - as it can also raise the tariffs for transportation of their gas across the Russian territory.

Other losers in this geopolitical game are the United States and the European Union. Gazprom’s compli­ance with the Central Asian states’ demands for a higher price makes it difficult, if not impossible, for all other negotiations. Whatever price agreed between the four gas companies, the European firms would have to pay more as well as shoulder the construc­tion of the South Stream pipeline or the high ground transportation costs. The South Stream pipeline itself no longer seems like a viable project. And this, of course, is the main paradox of this situation - to have Gazprom and the Central Asian states forge a new price alliance after all the diplomacy that went into breaking that partner­ship is akin to shooting oneself in the foot.

And what of Gazprom? I am actu­ally surprised to see the state monopoly behave in such a market-like manner. Of course, it’s difficult to name Gazprom one of this game’s winners until we see the actual numbers for the prices and tariffs, but the fact that it actually managed to turn this situation to its advantage commands some respect.

The Moscow News (2570)

Notes

outcome результат, последствие

label, v прикреплять ярлык, назвать

nod кивок

envoy посланник, агент, доверенное лицо

lure, v соблазнить, приманить

leverage система рычагов

compli­ance согласие

akin [ə′kin] сродни

22. Read and translate the following international words and word combinations from text 3:

national gas companies, a commercial secret, Gazprom’s press service, a press release, based on the inter­ests of national economies, start­ing in 2009, gas monopoly, the Russian media, industrial sector will react to the shock therapy, paradox of this situation, alliance, diplomacy.

23. What is the meaning of these words with negative prefixes?

unexpected, uninterrupt­ed, undecided, unclear, impossible.

24. What is the meaning of these complex words?

bomb-like, closely-guarded, long-term, pipeline, gas­dependent, market-like.

25. Match up the words in column A with their synonyms in column B:

A B

1. transport a. nation

2. negotiations b. coast

3. price c. talks

4. difficult d. result

5. envoy e. traffic

6. state f. hard

7. outcome g. spokesman

26. Match up the words in column A with their antonyms in column B:

A B

1. winners a. long-term

2. easy b. South

3. short-term c. losers

4. North d. dependent

5. to buy e. difficult

6. to put down f. to break

7. independent g. to sell

8. to build h. to raise

27. Give the plural form of the following nouns:

company, paradox, delivery, price, economy, service, territory.

28. Find in the text the English equivalents for the following expressions:

- руководители трех государственных газовых компаний

- природный газ по европейским ценам

- гарантировать надежные и непрерывные поставки энергетических ресурсов

- ценовая формула по поставкам газа из Центральной Азии еще не определена

- заявление, сделанное на этой неделе, обозначило явных победителей и проигравших в этом раунде игры

- предыдущие соглашения

- проекты строительства газопроводов через Россию

- вести отдельные переговоры за азиатский газ

- поднять тарифы за транспортировку газа

- проигравшие в геополитической игре

29. Read and say whether the following statements are true or false.

1. The heads of the three national oil and gas companies came to Samara where they held a meeting with Gazprom CEO Alexei Miller.

2. Central Asian countries won’t sell their natural gas for European prices in 2009.

3. There are not any clear winners and losers in this round of the game.

4. Ukraine is unable to hold separate negotiations for the Central Asian gas.

5. The United States and the European Union are winners in this geopolitical game.

6. Gazprom actually managed to turn this situation to its advantage.

30. Read and translate the text:

TEXT 4

Russia plans to slash food imports by half in up to three years, Russia’s Agriculture Minister Alexei Gordeyev said Saturday the RIA Novosti news agency reported.

“We face the task of bringing food imports down to 20 percent of the market,” Goredyev said. Today the ratio of national produce to foreign imports is 60 to 40.”

Russia is also due to cut poultry imports by 200,000 tons a year, by October or November, Gordeyev said.

At the end of August, Prime Minister Vladimir Putin said Russia would suspend some of its agreements made during its bid to become a member of the World Trade Organization (WTO) bacause they were unfair. The suspension concerned red meat, poultry and manufacturing, he said.

Putin vowed to return to the agreements once Russia becomes a member of the Geneva-based body, according to Interfax news agency.

The Moscow News (680)

Notes

slash, v снижать

ratio [′rei∫iəu] пропорция, коэффициент, соотношение

bid заявка

vow, v [vau] клясться, заверять

31. Find in the text the English equivalents for the following expressions:

снизить объемы импорта продовольствия, снизить объемы импорта мяса птицы, приостановить соглашения, Всемирная торговая организация, стать членом ВТО, вернуться к соглашениям, агентство новостей.

32. Answer the questions to the text:

1. What is Alexei Gordeyev? 2. What is Vladimir Putin? 3. Is this text about gas deliveries? 4. What is Russia due to do? 5. Why will Russia suspend some of its agreements? 6. Where is the World Trade Organization located?

33. What is the main idea of text 4?

34. Read and translate the following international words and word combinations from text 5:

The Russian Central Bank’s international reserves, the global financial crisis, bunkruptcy of financial institutions, chief economist, news conference, denominated part of the reserves, the financial sector, liquidity.

35. Read and translate the text:

TEXT 5

The Russian Central Bank’s international reserves, which saw strong growth for most of this year, have lost $40 billion (1 trillion rubles) in the past few weeks, an analyst at a leading brokerage said on Tuesday.

The international reserves, comprising foreign currency, gold, and a range of other assets, started the year at $478 bln, making strong gains each month to reach $596 bln on August 1, before slipping to $582 bln as of September 1 as the global financial crisis worsened.

“In the past few weeks, with the bunkruptcy of Lehman Brothers and other financial institutions, we have seen across-the-board selling of all possible assets, including in Russia... Russia has lost almost $40 billion in gold and currency reserves,” Yevgeny Gavrilenkov, chief economist at Troika Dialog, told a RIA Novosti news conference.

He said the loss had largely resulted from a revaluation of the euro- and pound-denominated part of the reserves.

Over the last few days the situation on Russian markets has been somewhat improving, despite the continued share price declines, he said. The most recent Central Bank data puts the international reserves at $559 billion (14 trillion rubles) as of September 19.

Prime Minister Vladimir Putin said on Monday that Russian companies had encountered problems in obtaining loan extensions or new loans amid global financial woes.

Russian stocks nose-dived on September 17 to their lowest point in nearly three years, and around 60 percent lower than their May high. The market rebounded on September 19 after the government scrambled to inject billions of dollars into the financial sector to shore up liquidity.

Finance Minister Alexei Kudrin earlier said the government could opt to buy back stock of Russian companies, including those with government interest, if they remained undervalued, spending up to 500 billion rubles ($20 billion).

The Moscow News (1500)

Notes

assets активы, имущество

decline спад, упадок

loan займ, кредит

amid [ə ′mid] среди, между, посреди

woe [wəu] несчастье, беда, горе

nose-dive резкое падение (цен и т.п.)

rebound, v отпрянуть, иметь обратное действие

36. What is the meaning of these complex words?

across-the-board, pound-denominated, nose-dived.

37. What is the meaning of these words with different prefixes?

revaluation, rebounded, undervalued.

38. Translate the following word combinations paying attention to the “–ing” forms:

a leading brokerage, comprising foreign currency, making strong gains each month, before slipping to $582 bln, across-the-board selling, problems in obtaining loan extensions.

39. Translate the following word combinations with prepositions of time:

for most of this year, in the past few weeks, over the last few days, on August 1, on Monday, on September 17.

40. Translate the following word combinations from the text:

foreign currency - currency reserves; gold reserves - pound-denominated part of the reserves; new loans - loan extensions; on Russian markets - the market rebounded; government interest - the government scrambled.

41. Answer the questions to the text:

1. What do the Russian Central Bank’s international reserves comprise?

2. What happened after the bunkruptcy of Lehman Brothers and other financial institutions?

3. Has the situation on Russian markets been improving?

4. What problems had Russian companies encountered?

5. When did Russian stocks nose-dive to their lowest point?

6. What is the Russian government going to do?