<P>This article is marred by its formulaic prose style, IMO, but it's still pretty informative and gives a nice snapshot of the situation.</P> <P class=bl><FONT color=black>Thursday, Apr. 15, 2004. Page 201 </FONT></P> <P class=htwored>Russia Revising Great Game Rule Book</P> <P><FONT class=bl><FONT color=gray>By Catherine Belton <BR>Staff Writer </FONT></FONT> <TABLE cellSpacing=0 cellPadding=0 width="99%" border=0> <TBODY> <TR vAlign=top> <TD vAlign=top> <TABLE cellSpacing=0 cellPadding=0 width=200 align=right border=0> <TBODY> <TR> <TD><IMG height=1 src="http://www.moscowtimes.ru/images/empty.gif" width=10 border=0> </TD> <TD align=left><BR> <P class=picsrc></P></TD></TR> <TR> <TD colSpan=2><IMG height=10 src="http://www.moscowtimes.ru/images/empty.gif" width=10 border=0> </TD></TR></TBODY></TABLE> <DIV class=textar align=left> <P class=textar align=left>To hear President Vladimir Putin tell it, the great game of the 21st century is economic in nature and Russia intends to change the way it's played.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>Putin made the rules of this new game clear in December, when he told the nation that the greatest danger facing Russia is a weak economy.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>"Our biggest threat is falling behind in the economic field," Putin told the country in his annual teleconference. "There is a tough, competitive battle going on in the world. But unlike previously, this battle has moved from the realm of military conflict to economic competition."</P></DIV> <DIV class=textar align=left> <P class=textar align=left>In this chess game, like those of the past, energy is king. But this time Russia is exploiting its prowess like never before. </P></DIV> <DIV class=textar align=left> <P class=textar align=left>On the eastern front, it has Japan and China locked in a bidding war for Siberian oil, while in the west it has Europe struggling to deal with its dependency on Gazprom's gas, and in the south it is slowly extending its electric tentacles through state power monopoly Unified Energy Systems.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>But what is emerging as a sort of "Putin Doctrine" doesn't stop there. It seems to envision Russia as the pivot around which the global oil market revolves, the power broker that can tip the balance between OPEC and the United States. And it seems to call for the rapid international expansion of patriotic companies -- both state-owned and private, energy and nonenergy.</P></DIV></TD></TR></TBODY></TABLE></P> <P>(snip)</P> <DIV class=textar align=left> <P class=textar align=left>By pushing for the building of privately owned pipelines -- one directly to China and another to Murmansk to better supply America -- "Khodorkovsky was pursuing a set of interests ... that was a threat to Putin's state policy," a senior U.S. administration official said in an interview in Washington earlier this year.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>In addition, the official said, Khodorkovsky's attempts to merge his oil company Yukos with smaller rival Sibneft and then sell a chunk of that company to a U.S. supermajor like ExxonMobil would have made him "untouchable."</P></DIV> <DIV class=textar align=left> <P class=textar align=left>"Fundamentally, this was a question about power," he said. "What Khodorkovsky was proposing presented problems for both foreign and domestic policy. ... State control over pipelines was both a domestic and foreign policy lever."</P></DIV> <DIV class=textar align=left> <P class=textar align=left>Now, however, all talk of building private pipelines -- or even of selling an equity stake in a major Russian oil producer to a U.S. company -- is taboo.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>"This is not the scheme the United States wants to see," said Julia Nanay, a senior energy analyst at Petroleum Finance Corp. in Washington. "It would like to see lots of private companies, private pipelines and more exports."</P> <P class=textar align=left>(snip)</P> <DIV class=textar align=left> <P class=textar align=left>Leading the way are state-controlled giants like Gazprom and UES. Gazprom is seeking to use its influence as a major supplier and payer of transit fees to Ukraine and Belarus to gain major equity stakes in each of the two countries' pipeline networks. And UES, under CEO Anatoly Chubais' "liberal imperialism" slogan, has been seeking to recreate Russia's monopoly on electricity production and distribution in former Soviet space.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>UES has already bought stakes in electricity assets in Armenia, Kazakhstan and Georgia, and Chubais has said he wants to move into Bulgaria, Latvia, Lithuania and Slovakia. The power monopoly is also in talks to rent an international power grid that connects Armenia, Georgia, Iran and Turkey.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>With U.S.-dominated NATO moving troops to Russia's borders, Moscow is countering by taking control of key infrastructure assets.</P></DIV> <DIV class=textar align=left> <P class=textar align=left>"Former Soviet states can't afford to ignore Russia's wishes," Weafer said. "At the end of the day, Russia can just turn the lights off. You can't run an electricity cable from Washington."</P></DIV></DIV> <P><A href="http://www.moscowtimes.ru/stories/2004/04/15/048.html">http://www.moscowtimes.ru/stories/2004/04/15/048.html</A></P><p> <hr size=1><font face=arial size=-1>Do you Yahoo!?<br> Yahoo! Tax Center - <a href="http://taxes.yahoo.com/filing.html">File online by April 15th</a>