06-04-01 Gazprom's media team says the firm had to take over embattled NTV to clear up the independent television station's debts and tangled finances. Yet Gazprom's own murky finances have made it no stranger to controversy. Since it became a private company following the fall of the Soviet Union, Gazprom has been the target of reports alleging insider dealing, diversion of cash flows, and meddling in politics.
Yet because of its size, wealth and political influence, Gazprom has consistently fended off proposals to break it up, clarify its finances, or bring it firmly under the control of the government, which owns 38.4 % of its stock. "Management thinks it's their company and they have no intention of allowing anyone to go and trespass on their property," Boris Fyodorov, a dissenting Gazprom board member, told.

Often dubbed a state within a state, Gazprom is the world's largest natural gas producer, with 39 % of global trade in 1999. It is also Russia's biggest company, with estimated sales of $ 17bn last year. Gazprom's clout comes not just from its wealth, but from politically-charged roles such as extending Russian influence in countries it supplies with gas and subsidizing Russian industries and households with cheap gas at government-set prices.
Critics say Gazprom's might has shielded it from demands that it open its activities to outside scrutiny. Fyodorov said it's not even clear how many legal entities make up Gazprom, which controls Russia's gas pipeline network, a string of gas-producing subsidiaries, and an export company that sells about a quarter of all the gas consumed in Europe.
"The question is whether Gazprom exists for the benefit of management, and the groups around management and some intermediaries, or whether it is for the benefit of the shareholders, including the Russian state," said Fyodorov. In the past year, Gazprom has come under attack from minority investors for its relationships with two companies: the gas pipeline construction firm Stroitransgaz and the gas trading company Itera.

News organizations have reported that Gazprom gave $ 1 bn in contracts to Stroitransgaz, whose major shareholders included two sons of former Gazprom chairman Viktor Chernomyrdin and the daughter of current CEO Rem Vyakhirev. The contracts raised questions of conflict of interest and the possibility that Gazprom was transferring cash to its friends rather than making sound business moves.
Chernomyrdin, a former gas minister who led Gazprom's privatisation, was Russia's prime minister from 1992 to 1998, then returned to Gazprom as board chairman before resigning last year. Stock analysts also say that Gazprom appears to be improperly transferring assets and cash flow to Itera to hide them from Gazprom shareholders.
Itera, a Jacksonville, Florida-based gas-trading firm, has risen over just the past three years from acting as gas broker between Gazprom and its customers to becoming a major player, now not just selling gas but producing it. "It is clear, if you see 10 years ago there was only Gazprom and it was big and mighty, and now Itera is also big and mighty and is comparable to a Western multinational, and you ask yourself: Is this coincidence?" Fyodorov said. "There is a big suspicion it was created with the help of Gazprom management."