A new Chechen oil company to be created

Apr 30, 1999 02:00 AM

Chechen President Aslan Maskhadov made another bid to reorganise the republic's oil industry last week, signing a decree authorising the formation of a new Chechen oil company.
The company, which is to be called Chineko, will have a monopoly over production, refining and sale of oil in the republic. It will also have exclusive control over the transportation of crude oil and refined products.
Under the decree, all individuals, organisations and enterprises not already subject to Grozny's control must liquidate or hand over to the authorities within one month their means of transportation for oil and products. The decree also states that the Chechen railway department will not be allowed to let any vehicles not specifically identified as the property of Chineko travel along the republican rail system. High-ranking executives will not be allowed to transport their oil by rail no matter what documents they produce, according to the decree.

Maskhadov dismantled Chechnya's old republican oil company Yunko in late 1997 in a bid to stabilise the oil industry and crack down on large-scale theft of crude from state facilities. Yunko was replaced with four government departments directly subordinate to Maskhadov. The Chechen president's press secretary Mayerbek Vachagayev said that these structures would be disbanded because they had not done their job. Corruption, theft of oil and declining performance have actually become bigger problems since Yunko was scrapped, Vachagayev said.
He said that Maskhadov hoped to correct the situation by centralising control over the oil industry. Indeed, some sources have reported that conditions are already improving due to the Chechen president's decision to set up a special task force to combat crime in the oil industry. The task force has been able to seize dozens of trucks formerly used by criminals to smuggle illegally refined gasoline out of Chechnya, the sources said. Chechen Interior Minister Aidamar Abalayev has also stated that all oil wells formerly operated by criminal groups are now back in the hands of republican authorities. (Some observers have dismissed this statement, saying that the oil wells in question were actually abandoned as their reservoirs were depleted.)
Russian Fuel and Energy Ministry experts, for their part, seem to think that more work will be needed. Thousands of metric tons of crude oil are still being stolen from wells and government-owned storage facilities in Chechnya every day, they said. As a result, refineries cannot run and the republican government's efforts to collect revenue are thwarted.
And with cash in such short supply, Grozny is all but unable to cope with emergency situations. Chechen authorities cannot, for example, afford to extinguish fires at oil wells. (They also cannot afford to rebuild a fire station built by the Soviet government to handle such blazes; the facility, known as one of the best in the North Caucasus, was destroyed during the war between Chechen separatists and federal troops.) At the end of April, four oil wells were reportedly on fire, with 1,500 metric tons of crude oil and associated gas being lost to the flames each day.

Source: NewsBase
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