Rem Vyakhirev: Gas industry executive who built up Gazprom into a global player

 

Under Rem Vyakhirev Gazprom 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. But he was accused of running Gazprom, as one critic put it, as "a candy store to provide sweet deals for whoever was running it."

Rem Vyakhirev was born in the village of Bolshaya Chernigovka in Russia in 1934, which even today is described by travellers as a poor and sad place. His father and mother were reportedly a blacksmith and schoolteacher respectively. Either out of conviction, fear or clever opportunism, they registered their son as Rem, a name they made up from "Revolution", "Engels" and "Marx". Sensibly they did not attempt to work Stalin into his name.

Rem was born into a society in turmoil. Hunger and Stalin's great purge accompanied his early childhood, followed by the Second World War. He went to the neighbouring city of Samara for his education. It was an impressive place, known as the "Russian New Orleans" and "Russian Chicago"; perhaps its old mansions led Vyakhirev to dream of future affluence. In 1935 it was renamed Kuybyshev in honour of the Politburo member Valerian Kuybyshev, and was chosen by Stalin as the alternative Soviet capital should Moscow fall to the Nazi invaders; ministries and embassies moved there.

Vyakhirev studied engineering, graduating in 1956. It was a time of optimism after the cloud of Stalinism had been lifted. At the 20th Congress of the Communist Party Nikita Khrushchev delivered his "secret" speech denouncing Stalin and ushering in a less repressive era. He aimed to catch up with, and overtake, the West within a few years, and engineers appeared to have a bright future.

In the years that followed Vyakhirev worked in the oil economy in various parts of the Kuybyshev region. He made good progress and acquired a reputation for his inside-out knowledge of the technical side of business. As one source put it, "He seemed to know every valve in the sector." His dedication led to his appointment as head of the gas development administration, and from 1983-85 he was a deputy minister of the Soviet gas industry. The following year he was promoted to first deputy minister and between 1989 and 1992 served as deputy chairman of the executive committee of the state energy concern, where his boss was Viktor Chernomyrdin.

In August 1989 the two men were the key to the transformation of the old ministry into Gazprom, Russia's first state-corporate enterprise. It controlled not only all the production fields but also all the natural gas pipelines in Russia, accounting for roughly a third of the world's gas reserves.

In May 1992 Russia's new President, Boris Yeltsin, appointed Chernomyrdin Deputy Prime Minister and Vyakhirev stepped into his shoes as chairman of Gazprom. In December that year Chernomyrdin became Prime Minister.

As the Yeltsin government promoted massive privatisation, the fate of Gazprom was in the balance. After much manoeuvring, Gazprom remained a monopoly, thus avoiding the fate of Russia's oil production concerns, which were broken into several entities.

In November 1992, in preparation for its partial privatisation, Yeltsin issued a decree converting Gazprom from a joint-stock company wholly owned by the state into a private, independent joint-stock company. Chernomyrdin saw to it that his protégé, Vyakhirev, was appointed chief executive.

During his years at the top Vyakhirev ran Gazprom almost as a family business, with his brother and son among the chief beneficiaries. In another cruel fraud against the long-suffering Russian people, in a secret trust agreement Vyakhirev and some other officials were issued options to buy 30 per cent of Gazprom stock at bargain-basement prices. The company executed large-scale tax evasion and the state received little revenue from dividends. The management and board members were accused of massive asset-stripping.

When Vladimir Putin became President of Russia in 2000, he launched a campaign to change the culture at Gazprom. He fired Chernomyrdin as the chairman of the company's board and used the stock owned by the state to vote out Vyakhirev. In 1998 Vyakhirev assets qualified him for a place on Forbes' list of the world's 200 richest people; in 2004 the magazine estimated his net worth at $1.2 billion.

After resigning as chief executive, Vyakhirev became Gazprom board chairman but resigned in 2002, and thereafter virtually disappeared from public life. In a dramatic change of lifestyle he lived somewhat reclusively at an estate outside Moscow which he rarely left, contenting himself with carp fishing and breeding deer. He died there from heart problems.

David Childs

Rem Vyakhirev, gas industry executive: born Bolshaya Chernigovka, Russia 23 August 1934; married (one son, one daughter); died Moscow 11 February 2013.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: PA

Negotiable: Recruitment Genius: A PA is required to join a leading provider of...

Recruitment Genius: Car Sales Executive - Franchised Main Dealer

£30000 - £40000 per annum: Recruitment Genius: This is a great opportunity for...

Ashdown Group: IT Support Analyst - London - £43,000

£35000 - £43000 per annum + Benefits: Ashdown Group: Senior IT Support Analyst...

Recruitment Genius: Technical SEO Specialist

£24000 - £28000 per annum: Recruitment Genius: This is an exciting opportunity...

Day In a Page

Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee
World War Z author Max Brooks honours WW1's Harlem Hellfighters in new graphic novel

Max Brooks honours Harlem Hellfighters

The author talks about race, legacy and his Will Smith film option to Tim Walker
Why the league system no longer measures up

League system no longer measures up

Jon Coles, former head of standards at the Department of Education, used to be in charge of school performance rankings. He explains how he would reform the system
Valentine's Day cards: 5 best online card shops

Don't leave it to the petrol station: The best online card shops for Valentine's Day

Can't find a card you like on the high street? Try one of these sites for individual, personalised options, whatever your taste
Diego Costa: Devil in blue who upsets defences is a reminder of what Liverpool have lost

Devil in blue Costa is a reminder of what Liverpool have lost

The Reds are desperately missing Luis Suarez, says Ian Herbert
Ashley Giles: 'I'll watch England – but not as a fan'

Ashley Giles: 'I'll watch England – but not as a fan'

Former one-day coach says he will ‘observe’ their World Cup games – but ‘won’t be jumping up and down’
Greece elections: In times like these, the EU has far more dangerous adversaries than Syriza

Greece elections

In times like these, the EU has far more dangerous adversaries than Syriza, says Patrick Cockburn
Holocaust Memorial Day: Nazi victims remembered as spectre of prejudice reappears

Holocaust Memorial Day

Nazi victims remembered as spectre of prejudice reappears over Europe
Fortitude and the Arctic attraction: Our fascination with the last great wilderness

Magnetic north

The Arctic has always exerted a pull, from Greek myth to new thriller Fortitude. Gerard Gilbert considers what's behind our fascination with the last great wilderness