Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Russian Prime Minister Vladimir Putin, centre, and Igor Sechin, left, look on during a signing ceremony for the Exxon-Rosneft deal in this Aug. 30, 2012 file photo. Mr. Sechin’s ties with Mr. Putin go back to the early 1990s. (RIA Novosti/REUTERS)
Russian Prime Minister Vladimir Putin, centre, and Igor Sechin, left, look on during a signing ceremony for the Exxon-Rosneft deal in this Aug. 30, 2012 file photo. Mr. Sechin’s ties with Mr. Putin go back to the early 1990s. (RIA Novosti/REUTERS)

Rosneft’s new leader sign of Kremlin’s rise as oil power Add to ...

From darkness into the limelight, Igor Sechin’s emergence from the Kremlin shadows to run one of the world’s great oil firms reflects how Vladimir Putin has used energy resources to recover the influence Moscow lost with the collapse of the Soviet Union.

Mysterious Cold War-era activities in Africa and substantial blanks in his biography preceded Mr. Sechin’s arrival in the Kremlin in 2000 when Mr. Putin became president; even then, as deputy chief-of-staff to the former KGB officer, Mr. Sechin kept such a low profile that Russian media dubbed him “Darth Vader.”

More Related to this Story

Yet after years working behind the scenes to wrest control of Russia’s oil riches from “oligarchs” like the now-jailed Mikhail Khodorkovsky, he is lately installed as chief executive of state-owned OAO Rosneft and stands of the verge of a takeover of BP PLC joint venture TNK-BP that will consolidate Mr. Putin’s grip on the industry and make Mr. Sechin one of the world’s top oilmen.

Now 52, his move from “grey cardinal” enforcing Kremlin power on the tycoons who had grabbed Russia’s resources in the free-for-all of the 1990s has not always been smooth. Pushed out of the Rosneft chairmanship last year by another Putin protege, then-president Dmitry Medvedev, it was only on Mr. Putin’s return as head of state in May that Mr. Sechin returned to the firm, appointed CEO at Rosneft just a day after a new cabinet had been formed.

On Thursday, he was in London for talks on a deal for control of TNK-BP, a joint venture between BP and four Soviet-born billionaires who have agreed to sell their half of a company valued at more than $50-billion. The British oil company might also sell out its stake.

A deal would further the march of Kremlin capitalism and Mr. Putin’s drive to repair what he has called the “geopolitical catastrophe” of the Soviet collapse by using control of energy resources to further Russia’s interests internationally.

Mr. Sechin has been at his side all the way.

The most prominent loser in the struggle, imprisoned tycoon Mr. Khodorkovsky, blames Mr. Sechin for masterminding the demise of his firm, OAO Yukos, which was bankrupted by tax claims. Once Russia’s largest oil company, Yukos’s main production assets went to Rosneft, which now holds the No. 1 ranking in the sector.

In the case of TNK-BP, the sidelining of the tycoons comes in a confrontation that has less painful consequences for them – and is more costly for the Kremlin, in financial terms at least.

If completed, it will be the latest in a series of coming-out parties – some successful, others less so – at which Mr. Sechin has chaperoned Rosneft as it has emerged as national champion.

While serving as a deputy prime minister, before his return to Rosneft as CEO, Mr. Sechin struck exploration deals this year with Exxon Mobil Corp., Statoil ASA of Norway and Italy’s Eni SpA. Those partnerships seek to develop Rosneft’s vast offshore reserves and secure a foothold abroad that would help it acquire know-how in extracting hard-to-recover “tight” oil – trapped in non-porous rock – from its fields in Siberia.

Industry sources say Mr. Sechin cleared the way by convincing Mr. Putin to back a new tax regime that encourages firms to invest.

Yet Mr. Sechin’s aim has also been imperfect. A $16-billion BP-Rosneft share swap agreed to in January 2011, with Mr. Putin’s blessing, collapsed under the weight of opposition from the AAR tycoons who own half of TNK-BP.

But the history of deals underscores both Mr. Sechin’s standing near the centre of Mr. Putin’s circle and his emergence into a more public role as the Kremlin looks abroad for influence, investment and much-needed know-how for its oil industry.

The spotlight was once an unlikely place for Mr. Sechin, whose ties with Mr. Putin go back to a meeting during a trip to Brazil in the early 1990s and their work together in the St. Petersburg mayor’s office before President Boris Yeltsin plucked Mr. Putin from obscurity to become his anointed successor in the Kremlin.

Mr. Sechin’s official biography consists of seven short lines, one taken up by saying he owns no shares in Rosneft. It says nothing about what he did between graduation from Leningrad State University in 1984 and 2000 when he became deputy chief of Mr. Putin’s presidential staff.

Even that elevation did not bring much limelight. Russian newspaper editors once complained of having not a single photograph of Mr. Sechin, which earned him the nickname “Darth Vader.”

That seemed appropriate for a man seen as a leader of the siloviki – a label derived from the word for “force” and applied to a cluster of officials drawn from military or intelligence backgrounds. Their prominence under Mr. Putin, a long-time KGB officer, has been accompanied by Russian criticism of the West and belief in a strong state role in the economy.

Mr. Sechin’s life in Soviet times is shrouded in secrecy, beyond a few tantalizing brushstrokes. Fluent in Portuguese, he worked as a military translator in Angola in the 1980s and in Mozambique with a shadowy Soviet trade body called Tekhnoexport.

The gaps have led to speculation about what he might have done in the final decade of the Cold War, when Portugal’s former colonies in southern Africa were proxy battlefields.

His move to more public role, however, may have made him less shy of media coverage. Russian state television recently showed Mr. Sechin making a field visit in Venezuela; a hard hat on his greying hair, his cheek marked by a smear of oil.

Follow us on Twitter: @GlobeBusiness

In the know

Most popular video »

Highlights

More from The Globe and Mail

Most Popular Stories