Economists treat Kadyrov-Sechin agreement as mutually beneficial

The depletion of oil reserves in Chechnya is the main factor, which encouraged the agreement between Ramzan Kadyrov and Igor Sechin on leaving the assets of the "Rosneft" in the ChechenRepublic. This opinion was voiced by economists interviewed by the "Caucasian Knot". According to them, due to the reached agreement, Igor Sechin will not have to build a useless oil refinery in Chechnya and Ramzan Kadyrov will receive additional funds to the budget of the republic for "social expenditures."

The "Caucasian Knot" has reported that Russian oil major Rosneft will not sell its regional assets to the Chechen authorities and build an oil refinery in Grozny, but it will stay in the republic and begin investing in its social infrastructure. This was agreed by Ramzan Kadyrov and Igor Sechin on April 19.

According to Alexander Pasechnik, the chief of the Analytical Department of the National Energy Security Fund, at present, it is too early to assess who is the winner of the dispute between the authorities of Chechnya and the "Rosneft".

"In case of construction of an oil refinery, the own oil production in Chechnya would not be enough for the development of oil refining. For sure, some volumes could be provided by additional oil exploration. However, at present, there are old, mature deposits in the republic, and the prospect of extracting additional volumes of oil is rather ambiguous," noted Alexander Pasechnik.

"There has been a change in the strategy of the 'Rosneft': the company has decided not to sell, but to develop. Investments in an oil refinery would have been more extensive than social intervention," summed up Alexander Pasechnik.

Full text of the article is available on the Russian page of 24/7 Internet agency ‘Caucasian Knot’.