Nationalization of Energy Assets and Regional Welfare; Sakhalin 2007
26 Pages Posted: 24 Dec 2007
Date Written: June 2007
Between 2001 and 2007, rising prices of oil and gas provided a gigantic domestic windfall for Russia's government in the form of export duties and resource taxes. However, the windfall created incentives for the federal government to re-capture control rights to natural resource stocks. Thus, the past four years have seen a substantial transfer of effective ownership from private firms to government control. This study explores why multinationals were willing to commit billions of dollars of FDI to a remote Russian island in the North Pacific. It asks how the de facto re-nationalization of energy assets will impact the availability of advanced technologies, investment efficiency, and environmental risks to the North Pacific fishery.
Keywords: Russia, energy, expropriation
JEL Classification: P28, Q40
Suggested Citation: Suggested Citation