TNK-BP Intermarried Finance Ministry
// Former Deputy Minister Mikhail Motorin became the company’s vice-president
TNK-BP introduced the position of vice-president for financial and economic issues, which was taken over by former Deputy Finance Minister Mikhail Motorin. He will work on coordinating the company’s interests with the constantly changing rules of state structures. TNK-BP now has 3 main problems with the state: Rospan-International company, Kovykta deposit, and taxes.
TNK-BP’s new vice-president for financial and economic issues Mikhail Motorin was officially introduced to the company’s CEOs on Monday. At the same time, Motorin became the advisor to TNK-BP’s president Robert Dudley. Motorin said that his responsibilities will include “GR, that is strengthening the company’s relations with government structures”. “I will deal with strategic consulting on financial and economic policy, interaction with executive and legislative authorities, analytical support for the activities of chief financial director,” explained Motorin.
Former minister has rich experience in working with authorities. For the last ten years, he occupied various positions in Russia’s Finance Ministry, and three years before that – in the budget and tax committee of the State Duma. In Finance Ministry till 2004, Motorin was deputy minister, and controlled the UST (unified social tax), the VAT, excise taxes, export duties, taxes on property and land, inter-budget relations. He monitored the development of the Tax Code’s chapter on the production sharing agreement (the chapter actually closed this regime for new projects). As a government representative, Motorin was a member of Sakhalin-2 supervisory board. Besides, he was responsible for regulating the insurance market, and represented state interests in Rosgosstrakh insurance company. In May 2004, after the dramatic decrease in the number of deputy ministers due to an administrative reform (only 2 remained in the Finance Ministry instead of 12), Motorin became the director of the tax and custom-duties policy department at the Finance Ministry. In that new position, he dealt with all issues of tax policy, including the putting to practice of the Tax Code.
Motorin’s intention to leave state service became known back in October. One of the explanations of that resignation was the conflict around the amount of customs duties for oil and gas export, in which the official allegedly took the side of Gazprom and oil companies. However, this information was not officially confirmed, and Motorin kept working in the Ministry till late November.
Motorin was one of the 3 officials of the Finance Ministry who had the right to sign its official letters explaining to tax-payers the debatable points of the Tax Code. Such explanations are used by companies in courts when suing against tax services. TNK-BP has already paid 45.3 billion rubles of 2001-2003 debt to the budget. It keeps claiming back some part of it in court. The company is now under tax check for 2004-2005 period. However, TNK-BP insists that “Motorin will not deal with tax issues”.
Experts said this appointment is a good acquisition for the company. “Due to TNK-BP’s somewhat unclear status, since it is owned by Russian entrepreneurs and British BP on a par, and due to certain difficulties with carrying out gas projects, it is important to use professionals to form a positive image for the company,” said Valery Nesterov of Troika Dialog investment company. In November, TNK-BP’s subsidiary Rospan-International received a number of claims from the authorities. Prosecutor General’s Office demanded to deprive it of the license for Urengoi deposit, and initiated an illegal enterprise case against Rospan’s CEOs. Russian Federal Agency for Subsoil Usage gave 6 months to TNK-BP to eliminate violations [see Kommersant of November 25]. Besides, the company risks losing the license for Kovykta gas-condensate field. The Ministry of Nature and the Prosecutor General’s Office have already warned TNK-BP about it. It is quite likely that Motorin will participate in settling the issues of Rospan and Kovykta.
However, Dmitry Mangilev of Prospekt investment company allows that Motorin will work for both sides. “It is hard to tell now, who initiated that appointment, the state or the company. If it was the state, then it wants to buy a share in TNK-BP,” the expert said. Viktor Vekselberg has already officially denied the plans to sell Russia’s share in TNK-BP. However, sources in Gazprom say that other co-owners of the company, German Khan and Mikhail Fridman, are against the sale, while Vekselberg is ready to bargain.
Natalia Grib, Vadim Visloguzov
All the Article in Russian as of Dec. 06, 2006
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