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Russia: Putin's Former Colleagues Make Up Today's Energy 'Team'

Gazprom CEO Aleksei Miller (left) and Putin were colleages in the St. Petersburg mayor's office (epa) For a glimpse into Russian President Vladimir Putin's views on energy and foreign policy, one need look no further than his years in St. Petersburg in the 1990s. The key players in Russia's energy industry today, in fact, are Putin's former colleagues and mentor from that time.

Putin, who had already spent more than 15 years as a Federal Security Service (FSB) agent, returned to school, studying at the St. Petersburg Mining Institute. One of the most prestigious academic institutions in Russia, it traces its history back to 1773. Since 1994 its rector has been Vladimir Litvinenko, who also serves as a member of the government's newly created Energy Commission.

Litvinenko was rector when a 44-year-old Putin in 1997 defended his doctoral dissertation examining how natural resources can contribute to regional economies and strategic planning.
The two groups of men surrounding Putin -- the 'siloviki' and the St. Petersburg's mayor's office group -- have become what one could call an informal 'board of directors' of the new Russia.

Two years later, Putin -- then the director of the FSB -- wrote an article for the mining institute's journal. The title of the article was: "Mineral Natural Resources In The Development Strategy For The Russian Economy."

In it, Putin posited that hydrocarbons were key to Russia's development and the restoration of its former power. He argued that the most effective way to exploit this resource was through state regulation of the fuel sector, and by creating large and vertically integrated companies that would work in partnership with the state.

Friends For A Lifetime

Putin formulated most of his energy views while working in the St. Petersburg mayor's office, where he headed the Foreign Economic Relations Department.

His colleagues in that office included: Aleksei Miller, now chief executive of the state-controlled Gazprom monopoly; Dmitry Medvedev, the head of the presidential administration, a deputy prime minister, and chairmen of the board of directors at Gazprom; and Igor Sechin, a man with ties to the former KGB, who is currently the deputy head of Putin's administration as well as the chairman of the board of directors at the state-owned oil company Rosneft.

As the St. Petersburg team rose in prominence, so too did the influence of the Mining Institute and its director, Litvinenko. The institute is now a compulsory stop for Russian and Germany energy leaders visiting St. Petersburg. The institute's official website notes that it has received delegations from the Germany's Wintershall gas company -- a close Gazprom ally -- as well as the board of directors of Gazprom subsidiary Surgutgazprom, and Vagit Alekperov, the head of LUKoil.

Litvinenko is also believed to have played a role in the drafting of Russia's energy strategy, which defined the role of energy as a tool of Russian state policy. Some observers have even suggested Litvinenko would be an appropriate candidate to replace Miller at the helm of Gazprom.

The 'Siloviki' Muscle In

But it is not only Putin's former classmates and mayoral co-workers who have found a role in the current government. Former agents of the KGB, the predecessor to Putin's FSB, also enjoy crucial influence in the Kremlin, and are known as the "siloviki," or "power men." These men have an impact on both government energy policy and the way in which it is implemented.

One of these men is Aleksandr Ryazanov, the deputy chairman of Gazprom, and reportedly the head of the "siloviki" faction within the gas giant. Ryazanov became chief executive of the Sibneft oil company after it was purchased by Gazprom in 2005. He has also been appointed head of UkrGazEnergo, the newly created Ukrainian-Russian joint venture to act as an intermediary between Ukraine's state-run Naftohaz Ukrayiny and the Swiss-based RosUkrEnergo.

Another is Viktor Ivanov, another deputy head of the presidential administration. Ivanov has a colorful history. A graduate of the Leningrad Bonch-Bruyevich Electrical Technical University, Ivanov worked as an engineer before reportedly joining the KGB in 1977 and fighting with Soviet forces in Afghanistan.

Upon his return, he rose to the head of the anticontraband department of the Leningrad Oblast KGB. He retired from service in 1994 with the rank of colonel and was appointed by Putin to head the administrative departments of St. Petersburg city hall.

The two groups of men surrounding Putin -- the "siloviki" and the St. Petersburg's mayor's office group -- have become what one could call an informal "board of directors" of the new Russia. As such, they set the agenda for Russian energy policy and in fact control the country's vast energy resources. Their influence should not be underestimated.

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See also:

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