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. Last Updated: 07/27/2016

New Gas Chief Is Putin Ally

Unknown
He is young, relatively unknown and, in fact, a dark horse. But Alexei Miller is yet another member of Vladimir Putin's St. Petersburg team who has been brought to the very top.

Miller, 39, was named the new executive of Gazprom on Wednesday. He had been serving as a deputy energy minister.

Miller's career until Wednesday was a straightforward path from being a low-ranking St. Petersburg bureaucrat to a deputy minister — with one notable exception. He built his career under the wing of President Putin. The two men have known each other for at least a decade, and in the mid-'90s Miller was Putin's deputy at the foreign relations department in St. Petersburg.

It appears that Miller's loyalty to Putin more than any qualifications earned him the post of the chief executive at the world's largest gas company.

Putin personally received Miller in the Kremlin after the appointment.

Miller is the latest in a chain of close Putin allies who have gradually taken over top posts in Russia. Most recently, Putin appointed Boris Gryzlov, an old acquaintance and the head of the pro-Kremlin Unity faction in the State Duma, as interior minister. Also in April, he made Sergei Ivanov, a longtime colleague from the Federal Security Service, defense minister.

Miller was born in 1962 in St. Petersburg, then Leningrad. In 1984, he graduated from the Leningrad Institute of Finance and Economics. He holds a doctorate in economics.

Miller's bureaucratic career started in 1991 when he joined the economic reform committee of the Leningrad city administration. He left City Hall in 1996 to head the investment division of the St. Petersburg Sea Port. In 1999, he was appointed head of the Baltic Pipeline System, a project to link Russia's oil reserves to the Baltic Sea.

He was called to Moscow to join the Energy Ministry as a deputy a year ago. There, he developed energy strategies and supervised energy ties with the West and organizations such as OPEC.

Miller is married and has a son.

Pro-Kremlin politicians praised Miller's appointment, while analysts and liberals said the move was a mixed bag.

"From a business viewpoint the decision is horrible," said Boris Nemtsov, leader of the Union of Right Forces faction. "This means that the Kremlin still considers Gazprom a political rather than economic structure."

While pointing out that bringing an outsider to run Gazprom was a positive step, analysts cast doubt on Miller's managerial skills and his capacity to tame a company fiercely loyal to Vyakhirev.

Roland Nash, chief strategist with Renaissance Capital brokerage, said the selection was largely based on Miller belonging to Putin's old team, rather than any outstanding management qualities he may possess.

"He is known to do what Putin tells him to do. The most important qualification that he's got is his personal loyalty to Putin," Nash said.

As Putin would have it, Miller's main goal will be to reform the gas giant by cleaning up its books and making it more investor friendly.

Miller spoke vaguely about his plans Wednesday, using an interview with Interfax to praise Gazprom's achievements.

"Miller is considered to be a person close to German Gref, who is probably the only man in the country with a program to reform Gazprom," said Dmitry Avdeyev, oil and gas analyst with United Financial Group. Gref is the economic development and trade minister and also a St. Petersburg associate of Putin's.

Avdeyev said, however, that Miller's track record suggests that his views on economic and market policies are not consistently liberal. For example, during his stint as deputy energy minister, Miller insisted on tougher control over oil exports and advocated tighter state regulation of the domestic oil market.

Miller's success at Gazprom's helm will depend on his yet unproven ability to run the company with an iron fist.

"He is likely to be given enough political power to fulfill this kind of reform. The question, however, remains whether his managerial skills will be sufficient to fulfill the task," Avdeyev said.

"But after all, we elected an unknown guy to be president, so we will certainly survive an unknown person as chief executive of Gazprom," he added.