Rem Vyakhirev, Gazprom Chief Replaced by Putin, Dies at Age 78
Stock Chart for Gazprom OAO (GAZP)
As CEO of Gazprom from 1993 to 2001, Vyakhirev expanded long-term gas supply contracts with European buyers and oversaw large-scale projects such as the Blue Stream pipeline across the Black Sea to Turkey and the Yamal-Europe link across Belarus to Poland.
“We express our sincere condolences to the relatives,” Gazprom’s press service said by phone. President Vladimir Putin, who brought in current CEO Alexey Miller to replace Vyakhirev and help return assets that had been moved out of the company, also expressed his regrets. The cause of the death wasn’t disclosed.
Gazprom, Russia’s biggest company by market value and the world’s biggest gas producer, meets about a quarter of Europe’s demand for the fuel and has monopoly control over national pipelines and exports.
Born on Aug. 23, 1934, Vyakhirev worked his way up through the Soviet Oil and Gas Ministry, becoming deputy head when Gazprom was turned into a state corporation in 1989. He was named chairman in 1992 when his predecessor Viktor Chernomyrdin was appointed prime minister to Russia’s first president, Boris Yeltsin, and CEO when the company was made into a joint-stock company in 1993. After being replaced as CEO, Vyakhirev was Gazprom’s board chairman for about a year.
“The gas industry should be in one pair of hands, in state hands,” Vyakhirev said in an interview with Forbes’s Russian edition in September. “There’s all this talk about breaking the gas addiction. That’s ridiculous. It’s a cash cow, not an addiction. The country, back then when prices were low and now when they’ve risen, lives on this money.”
Putin replaced Vyakhirev about a year after taking over from Yeltsin as president as he began boosting the role of state companies in the economy and used Russia’s energy wealth to gain international influence. Oil and gas accounts for about half of the country’s budget revenue.
“During the Yeltsin era, Gazprom was trading as low as 4 cents a share,” James Fenkner, a money manager at Red Star Asset Management LP, said in 2007. “Value was being destroyed. Gazprom was just a candy store to provide sweet deals for whoever was running it.”
Under Miller’s management, Gazprom sought to regain assets and markets, while the state increased its ownership to a more than 50 percent controlling stake and removed restrictions how foreign investors could own and trade its shares.
“I never wanted to be the head of a company,” Vyakhirev said in the interview with Forbes. “But why refuse if the entire business is in your hands. If you give it to someone, they would either drink it away or lose it.”
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