RA in the Financial Post: Gazprom as an Arm of the Kremlin

Robert Amsterdam’s speech in Calgary today was covered by the Financial Post:

Gazprom just an arm of the Kremlin, Khodorkovsky’s lawyer warns Canadians People should understand that OAO Gazprom, the Russian gas giant that wants to become a major supplier to North America, is not a company but an arm of the Kremlin, says Robert Amsterdam, the Canadian lawyer who counseled Mikhail Khodorkovsky, the former CEO of Yukos who was convicted of charges of tax evasion and is serving an eight-year jail sentence in Siberia. “[Russian president Vladimir] Putin says it,” Mr. Amsterdam said in an interview before speaking to the Economic Club of Calgary on Tuesday about Russia’s resource nationalism. “We need to believe Mr. Putin when he says he thinks it’s fine for energy to be used as a weapon. And we need to clarify what that means in terms of Canada and the U.S. They are a great monopolist.”

“And there is a tremendous distinction between what they announce and what they actually do, as anyone who knows what they do in Europe will tell you.”Gazprom could soon get a foothold in the Canadian market that will enable it to sell its gas to American customers. It has been offered a stake of up to 20% by Petro-Canada in a $1-billion regasification facility in Quebec that would supply U.S. markets, as long as the Canadian company is picked as a partner in its US$3.5-billion Baltic liquefied natural gas plant near St. Petersburg.Mr. Amsterdam said Mr. Putin’s energy strategy is not to compete, but to dominate and manipulate. “It’s like he read [former General Electric CEO] Jack Welch’s books,” Mr. Amsterdam said. “Wherever he thinks that Russia could have a competitive advantage, he pushes very hard to give Russia a very significant stake and it’s market distorting.”There’s room for Russian companies to invest in Canada, and for Canadian companies to do business in Russia, as long as there is “symmetry” in the rule of law and Canadian values are exported there, not the reverse, he said.“Canadian companies and individuals who get involved in Russia should tell Canadians the truth about what is going on there, and not present false facts,” he said. “One of the dangers of our business leaders who invest in Russia is that their positive opinion about Russia is to no small extent the result of the fact that their investments are hostage.”If you have a mine in Russia, and you don’t have the rule of law to protect it, you have to make sure the government is pretty sweet on you, and that is why companies like BP [PLC] lie about their feelings toward Russia.”Claudia Cattaneo