OREANDA-NEWS. June 16, 2009. After acquainting himself with the work of the State Commission on Mineral Reserves, Prime Minister Vladimir Putin chaired a meeting on improving the system to monitor and manage subsoil resources. 

Vladimir Putin's opening remarks:

Good afternoon,

We have discussed our priorities for the mid and long term more than once. These priorities remain unchanged: innovative development of the Russian economy.

But today I suggest that we discuss the resource base. First, work with subsoil resources can and must be connected with high technologies. Second, the work in this area brings us large revenues today, to our companies, and to the budget.

It is, as the saying goes, the goose that lays the golden egg. This topic requires due attention.

Today we looked at the work of the State Commission on Mineral Reserves. The commission plays a major role in the development of the country's mineral stock, specifically analysis of the subsoil and the preparation of recommendations on its commercial development.

During the course of our meeting today I propose we concentrate on improving the effectiveness of the system of managing mineral resources. This includes a range of diverse problems which call for a consensus of decisions, including geological prospecting, rational development of fields, the use of effective extraction methods, and the implementation of logistical systems.

I have to say that in recent years, thanks to the activities of the Government and private business, the depletion of the country's mineral resources has been curtailed. After the relevant decisions were passed and federal financing was resumed in 2005, the reserves were confirmed and the volume of geological prospecting started to grow again.

"In 2008 we ensured complete renewability of practically all of our strategic resources (oil, gas, gold, copper) with every rouble of government investment being matched by about 8-10 roubles in private investment."

The practical development of new mining provinces has begun. I am referring to the oil and gas fields in East Siberia, the opening up of Yamal, the Caspian offshore resources and Sakhalin Island.

At the same time the implementation of these major projects has revealed some bottlenecks and systemic gaps in the management of our natural resources.

First, let's face it; we still do not have a single system for monitoring and managing subsoil resources. The relevant information is accumulated by different agencies, is recorded and classified in different ways, so that it is practically impossible to obtain complete data on the fields and the users of subsoil resources in one place.

In the area of subsoil resources managerial functions are performed by the Ministry of Natural Resources and Environment, the Federal Agency for Subsoil Use (Rosnedra), the Ministry of Energy, Federal Service for Supervision of Environment, Technology and Nuclear Management (Rostekhnadzor), Federal Service for Supervision of Natural Resources (Rosprirodnadzor), the Ministry of Regional Development, the Federal Registration Service (Rosreyestr) and the Federal Service for State Statistics (Rosstat).

Instead of all this, I propose we set up an ad hoc group and charge it with presenting proposals to create a single system for subsoil resource management.

Second, we still have excessive administrative barriers all along the chain, from obtaining a prospecting license to the start of industrial development in areas of subsoil use. This, among other things, prevents geological prospecting from becoming a full-fledged business capable of delivering to the market a complex product: the field fully prepared for development with all the relevant technological information and the necessary approvals and licenses. Instructions to remove bureaucratic obstacles have been issued many times, but things are moving at an unacceptably slow pace.

To this day the users of subsoil resources - and I see many representatives of our big companies here - take years to obtain the necessary documents after the decision has been made in principle, they have to spend years visiting various agencies. And these are the largest companies; small and medium-sized businesses have a harder time still.

Third. Experience shows that we still do not have a comprehensive approach to the development of new territories. You may remember that in their time West Siberia, Kuzbass and other major resource centres were created and developed as integrated territorial production complexes. I believe that much of that past experience could be used today, naturally, with due account of the current economic realities. That is both in the interest of the state and in the interest of business which could greatly cut its costs by pooling efforts. It could create a common transport network, energy supply system and the social infrastructure far more effectively and at less cost than if everyone goes it alone.

Let me note that the creation of an integrated infrastructure would open up additional possibilities for the development of small and medium-sized fields.

In light of the above, our task is to join the mining companies, the natural monopolies and the regional administrations in developing comprehensive programmes of opening up new oil and gas provinces and other major fields. What is needed is an instrument of integration. The relevant proposals must be prepared.

We are primarily talking about such projects in East Siberia (Talakan, Verkhnyaya Chona and others), the Uvatsky district in Tyumen Region and the prospects for a single project to develop the fields on Yamal and in the north of the Krasnoyarsk Territory.

To be sure, there are other problems as well. They have been raised by the subsoil users and the representatives of the sectoral science, and the relevant ministries and agencies.

Let us discuss the whole range of these problems.