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. Last Updated: 07/27/2016

Sibneft Director Steps Onto Kremlin Stage




As the latest Russian government is shuffled and reshuffled, attention has focused on a burning question: Who is pulling the strings?


While no one has found a definitive answer to this question, the extreme difficulties in finding an answer have focused attention on the shadowy but powerful figure of Roman Abramovich and his links to the presidential family and to the Sibneft oil company.


As archtycoon Boris Berezovsky keeps a low profile - or is pushed out of the picture depending on which Russian media commentator is talking - Abramovich has emerged as one of the media's prime candidates for the role of puppet master.


At 32, Abramovich has certainly enjoyed a spectacular rise, one that can rival any of his fellow Russian tycoons in its meteoric nature. But unlike even the most modest of the oligarchs, he has remained very much in the shadows.


Not only does he rarely appear in public, but the sources of his wealth remain obscure - as does his very appearance. There are apparently no photographs of Abramovich in the public domain.


Scandal sheet Versiya was so frustrated that it organized a competition, offering prizes to readers who could furnish the paper with photos of the man who is said to run the Sibneft oil major. NTV's "Itogi" current affairs program had to rely on a few seconds of footage from the January 1998 press conference held in honor of the agreement to combine Sibneft with Yukos in the ill-fated Yuksi joint venture.


Abramovich's role at the top of Russia's political and business scene began at least as far back as 1996. Around that time,Abramovich was working as the head of the Moscow representative office of Runicom SA, a Swiss-based firm.


After Runicom bought a 12.2 percent stake in Sibneft at a cash auction in 1996, Abramovich became the head of Moscow's Sibneft office.


These days he is listed by Sibneft as one of "the people behind Sibneft" on the company's web site (www.sibneftoao.ru), which provides no further information about him. Neither would Sibneft's press office, other than to confirm that he is still the head of the firm's Moscow office and that he is listed on Sibneft's board of directors.


The press office also insisted that he is not the man who runs Sibneft.


However, according to the monthly Oil and Capital magazine, Abramovich stands behind four front firms - Sins, Rifain Oil, Runicom and Financial Oil Corp. - which between them held 91.6 percent of Sibneft as of mid April.


Through an extremely complicated web of relationships, these four firms also connect Abramovich with Berezovsky and with SBS-Agro bank, part of the empire of Alexander Smolensky.


Abramovich has also been listed as one of the people behind the Yeltsin family by numerous sources, including most noticeably, former presidential intimate Alexander Korzhakov.


In his memoirs, Korzhakov called Abramovich "the cashier" for the family, tying him to Berezovsky and to the latter's friendship with President Boris Yeltsin, the president's daughter Tatyana Dyachenko, and her husband, Alexei Dyachenko.


And Alexei Dyachenko also has strong ties to Sibneft. Boris Yeltsin's son-in-law heads an oil products trading company, East Coast Petroleum, according to Energy Compass oil newsletter. This firm lifts oil products from the Sibneft-affiliated Omsk refinery in Siberia.


But the Abramovich-Dyachenko-Yeltsin axis does not stop there.


East Coast Petroleum has a Moscow-based affiliate called Belka Trading Corporation, which published the second volume of Yeltsin's memoirs in 1994. Those memoirs - ***Zapiski Presidenta*** in Russian - were published in English by Belka in conjunction with Times Books, a Random House subsidiary, as "The Struggle for Russia."


According to Korzhakov, Berezovsky associate Valentin Yumashev - the ghost-writer for the memoirs - used to turn up every month with $16,000 in cash for Yeltsin that represented "royalties" for the book.


Abramovich has seemingly escaped the president's reported wrath over the accusations that Sibneft had been somehow connected with spying on the Yeltsin family. Investigators raided Sibneft's headquarters building in Moscow in February, and reported finding evidence of some intelligence-gathering activities. Although media reports at the time speculated that both Sibneft and security firm Atol had been linked in an effort by Berezovsky to collect compromising material on the Yeltsin family, no evidence of any such conspiracy has ever emerged.


Meanwhile, for all the talk of Abramovich as the new puppet-master at the Kremlin - in some versions pushing aside his old mate Berezovsky - there is no evidence that Abramovich has branched out to involve himself in activities outside of Sibneft.


Instead, mostly through oil trading firm Runicom, he has been busy consolidating Sibneft's hold on its subsidiaries.


In addition to marketing Sibneft's crude and refined oil products, Runicom has also helped the oil company to consolidate its holdings through a share swap.


Runicom was registered in Gibraltar by its major shareholder Valnut Nominees, which holds a 99.8 percent stake in Runicom, according to Oil and Capital magazine.


Runicom currently holds a 10.62 percent stake in Sibneft. The trading firm has helped the oil holding to build up its share to 94.5 percent in Noyabrskneftegaz, a Sibneft producing subsidiary. Sibneft also increased its share to a 66.7 percent stake in the exploration unit Noyabrskneftegazgeofizika, according to Sibneft's press service.


On Monday, Runicom had closed its offer to shareholders in the Omsk refinery, retail firm Omsknefteprodukt and the Noyabrsk-based exploration outfit to swap their shares in the subsidiaries for shares in the Sibneft holding company.


Runicom has managed to swap up to 5 percent of Sibneft shares for the refinery securities, building the oil holding's control over the utility to about 43 percent, Sibneft's press service reported Monday.