Gazprom Brings Purgaz Back Under Its Umbrella

Gazprom's board voted to buy back a 32-percent stake in the Purgaz gas producer from Itera, a decision that appears to be the first concrete step made by the new management showing its commitment to change the natural gas monopolist. "We were given one small Christmas gift from Gazprom with this Purgaz solution," said Boris Fyodorov, a Gazprom board member who represents the interests of minority investors and a fierce critic of the previous management, whom he claimed engaged in asset-stripping. Purgaz was not penciled into Monday's board-meeting agenda. Instead, Fyodorov said, Gazprom CEO Alexei Miller caught the board by surprise by bringing up the issue. Purgaz supplies about 70 percent of the gas extracted by Florida-registered Itera, which was once a Gazprom subsidiary. Initially, Itera obtained 49 percent of Purgaz in exchange for agreeing to develop the Gubkinsky gas field. But in 1999, Gazprom sold a further 32 percent stake to Itera for 32,000 rubles (about $1,300 at the time), keeping a mere 19 percent to itself, Saint Petersburg Times wrote.