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Anatoly Rudnik: Ukraine is No 1 in the world in natural gas transit
Anatoly A. Rudnik, M.S., has been director general of Ukrtransgaz, a filial company of the National Joint Stock Company Naftogaz Ukrayiny, since 1999. He is a full member of the Academy of the Ukrainian Oil and Gas Academy, laureate of the State Prize in Science and Technology, member of the Charity Fund of St Nicolas the Miracle Worker. He is a recipient of many awards (Orders Za zasluhy — For Merit — of the 1st, 2nd and 3rd categories; Order of St Volodymyr — for Services to the Church; appreciation certificates from the Verkhovna Rada and from the President of Ukraine; two International Earthmaker/Crystal Knight and Gold Badge awards; Gold Medal of the Association of Industrialists of France, and International Gold Mercury Award).
Ukraine occupies the first place in the world as to the amount of natural gas that passes in transit through its territory — 110 to 120 billion cubic metres a year. The Russian share of this gas is the biggest and amounts to 85 percent. The Ukrainian company Ukrtransgaz transports the Russian gas through its pipelines to 19 countries of Europe
Ukrtransgaz is a filial company of the National Joint Stock Company Naftogaz Ukrayiny. It unites 17 structural subdivisions with facilities in all the Oblasts of Ukraine, including 6 regional boards of the gas mains — Kyivtransgaz; Kharkivtransgaz; Donbastransgaz; Cherkasytransgaz, Lvivtransgaz and Prykarpattyatransgaz.
Ukrtransgaz delivers natural gas to Ukrainian and foreign customers in the post-Soviet countries and in Europe. Ukrtransgaz operates 36 thousand kilometres of pipelines with 71 compressor plants and 12 underground storage facilities with the capacity to store 32 billion cubic metres of gas.
The general director of Ukrtransgaz Anatoly Rudnik was interviewed for the Welcome to Ukraine Magazine by Myroslava BARCHUK.
Mr Rudnik, I know that in your life you moved a lot from place to place, sometimes you travelled long distances. Was it because you don’t like staying at one place for long, or because of the circumstances required frequent movement from place to place?
I believe that every person has a star that guides him or her through life. My star took me to distant lands (Mr Rudnik laughs at this point). I was born in the land of Poltavshchyna, and I grew up in the land of Rivenshchyna. I had an ambition, like many other boys of that time, to go to study at an aviation college. But among my hobbies were motocross and motoball — it’s a sort of soccer but instead of running you ride around the field on the motorbikes. In fact, this motoball became, at one point, more than just a hobby. And I decided to do something in life that was connected with automobiles. My cousin who is an engineer in the field of heat-and-power engineering, told me that the Energy Department of the Lviv Polytechnic Institute was just the right place for me to go study to. He said that one of the majors there dealt with automobile troops. He was so persuasive that I did go to Lviv and matriculated. I majored in heat-and-power engineering, and at that time engineers of such specialization were in demand. When I was nearing the end of my studies, my father died and I had to provide for the family — for my mother, sister and brother. Whenever I could, I joined construction brigades to earn money. In those days, that kind of work paid rather well, particularly if you worked in some remote places, under trying conditions. I went with such a brigade to many places, and even as far as Kamchatka in Russia. I liked it there so much that after graduation in 1972 I went to work there, and stayed for ten years. I worked at an electric power station. I made a career in heat-and-power engineering. I earned experience, and good money by the then standards, and they gave me an apartment to live in.
What was it that attracted you so much in Kamchatka that you stayed there for ten years?
A place to live in, good friends and an interesting job. These are three things, as far as I am concerned, are necessary for every young and ambitious person in order to feel satisfaction from life. It’s much later, when you are over fifty, you begin to feel nostalgic, and you begin to reflect upon things, to ponder over them in a more profound way. When I was young, it did not make any difference for me where to work. There was no acute sense of the native land in me, and the then society was uniform all across the Soviet Union, from Ukraine to the island of Sakhalin in the Sea of Okhotsk in the east. But at the end of the nineteen seventies I did return to Ukraine.
Was it then that you started working in the gas sector of the economy?
Not right away. First, I worked in the Dniproenergo energy distributing company, and later went to work as an operator of a gas-distribution station. It was a step down in the sense of my social position, but I entered a different sphere of work, it was a challenge and I liked it. I gradually worked my way up. I’m convinced that to become truly professional in any sphere you have to move up from to the lowest rung to the top. I was promoted to the chief engineer of the Dnipropetrovsk Gas Mains Management Board of the Ukrgazprom Company but not before I had learnt in detail the functioning of the whole system, while rising through the ranks.
Since then, you’ve been working in high posts?
Yes, you can say that. In the early 1990s, I worked for four years in Zaporizhzhya as head of Ukrgazprom, then moved to Kharkiv and worked there as director general of the Kharkivtransgaz Company, and three years later I moved to Kyiv, where since 1999, I’ve been heading Ukrtransgaz, which is a filial company of the National Joint Stock Company Naftogaz Ukrayiny. As you see, in spite of my moving from place to place, I’ve been working for one and the same company in the past twenty five years.
What do you find to be the most difficult thing to deal with?
It’s not a thing, it’s people. With hardware it’s easier — if something goes wrong or breaks down, you repair it, or if it is worn out, you just throw that thing away and install a new one. Working with people is much more difficult. It’s a very demanding, very delicate thing to be working with people, particularly in today’s Ukraine. In relations with people, it’s very difficult to “repair” things, to make amends, to smooth over the bad feelings. Sometimes it is even impossible.
How many people are now working on the staff of Ukrtransgaz?
29 thousand. An average salary of our engineers is 1350 hryvnyas a month.
It is a high salary by Ukraine’s standards! How did you manage to achieve this level? Back in 1999, when you came to head Ukrtransgaz, the economy of Ukraine was in a shambles.
It’s not my personal achievement. When I joined the company in 1999, it was a well-established, smoothly functioning and well-working team, and my main task was not to interfere with its functioning but to protect it socially, to give it social benefits. Back then, the company was more than one billion hryvnyas in debt to the budget, it was in a critical financial situation, it was one billion hryvnyas in debt to the suppliers, and the workers’ pay was twelve months in arrears. The first thing I did when I filled the post of director general, was to promise the workers that the arrears would be paid back within eight months and that there would be no more delays in payments. I added that if I failed to do it, I’d resign. Frankly speaking, it was a somewhat rash promise, I was much worried I’d fail to keep this promise. But on the other hand I had enough confidence I’d manage to do it. When I had worked in Kharkivtransgaz, a company five-thousand strong people, we had never had any debts or arrears. I convened a meeting of managers of our branches and told them, “You have six months to get things right. If by the end of this term we still have debts and arrears, I’ll fire all of you and then I’ll resign myself.” And it did work. Now we are a successfully working company, we have not had any debts to the budget for three years; for four years we’ve had no arrears, and the average wages will have gone up twenty percent by the end of this year. Besides, we’ve created a comprehensive system of social protection of pensioners and the company’s veteran workers, current employees and their children. We provide vouchers for stays at resort centres at great discounts, we help our employees improve their health, we provide free medical care. We pay additional money to the retired workers on top of their pensions that draw from the state, and these additional sums are quite considerable. There are 4,900 retired former workers of the company and this number constitutes seventeen percent of the company’s present-day workforce. If we should speak about my personal contribution to the company’s success, then you can mention only one thing. I have not allowed a single former communist functionary to come to work in our company. Neither did we have to draw workers from elsewhere. We hire only highly qualified people, and quite often we provide our potential or actual workers with means to receive college education. And that includes workers from bottom to top — from operators of gas-distribution stations up to engineers.
How much gas passes in transit through Ukraine? And how much Ukraine earns for it?
The oil and gas complex — and we are the biggest company in this complex — gives the budget 14 percent of the revenues. We are the sole gas bridge between Russia and Europe. 33 percent of all the gas used by Europe comes through Ukraine. Our company transports about 110 billion cubic metres of gas to 19 countries of Europe. It’s about 85 percent of gas that Russia exports. For providing transit, Ukraine earns 30 billion cubic metres of gas. 18 billion cubic metres is produced in Ukraine itself but it’s not enough and Ukraine has to buy additional 22 billion cubic metres of gas, so that Ukraine’s consumption of gas totals 70 billion cubic metres.
In view of this, the delivery of gas and oil, or the stoppage of such delivery often becomes an instrument of political blackmail. Does this situation affect the work of your company in some way?
Political tensions do come up once in a while, but we never have any “technological” tensions, as it were. We do what we have to do as professionals must. The Ukrainian gas industry has long and steadfast traditions. This year marks the 80th anniversary of the construction of the first Ukrainian pipeline from the Dashava gas deposit to the town of Striy in Western Ukraine. It was the starting point in the development of the gas industry in Ukraine. In 1948 the gas pipeline Dashava-Kyiv was built, and later pipelines connected Dashava to Moscow and Minsk. In 1967, the gas main Dolyna-Uzhgorod-State Border began delivering gas to countries of Central and Western Europe. Thus, the major corridor through which Russia began transporting its gas to Europe was opened, and Ukraine became a major gas transit country. Now Ukraine’s gas transport system is connected to similar systems in the neighbouring countries — in Russia, Belarus, Poland, Rumania, Moldova, Hungary and Slovakia, and through these systems, it is integrated into the European gas network. I’d like to emphasize here that the majority of the best specialists in all of the post-Soviet countries in the sphere of gas transit are graduates of Ukrainian colleges. But it is not purely professional and technical links that exist between us — it’s a very friendly relationship, in many instances we are connected through family ties. I can call the people at all the important points along the gas corridor from Surgut, Tumen to Prague and further west and get a problem settled in a telephone conversation. There is no tension whatsoever at our, technical level.
What about politicians? And can Ukraine do without the Russian gas, for example?
Ukraine has an alternative source of gas in Turkmenistan. It gives us a measure of energy security. This issue has been dealt with at the highest political level. In fifty five years that the Ukrainian gas transit system has been in operation there has not been a single emergency that would disrupt the flow of gas — no sudden changes of weather, no seasonal fluctuations in the use of gas, no technical or natural cataclysms, no changes in the economic situation, no political upheavals have ever affected the transport of gas through Ukraine. The system has always been stable and has kept increasing its capacity. Both Europe and Russia depend on the smooth functioning of the Ukrainian gas transport system.
What are the prospects of development for Ukrgazprom?
We have what we call “a debt to the pipe.” You see, we have been able to pay back our debts to the budget, to our suppliers and to workers — all of it thanks to, and at the expense of, “the pipe.” The pipe that carries the “blue blood of the economy.” It’s time we paid our debts to it. There are many things on our agenda — modernization; reconstruction; maintenance of the pipelines, of the distribution stations, of the gas-metering stations, of the compressor plants at a proper technical level; increasing the gas pipe’s capacity and raising the efficiency. We have worked out a programme of the reconstruction of the gas transport system. We shall use Ukrainian-made gas turbines and compressors which meet the world standard requirements. And the first such new-generation turbines have been successfully installed at some compressor plants.
Also, we continue to expand the gas transport system, alongside its reconstruction and modernization. In the past ten years we have built 5 thousand kilometres of gas mains and side pipelines, and 10 compressor shops. As you can easily see, we have a lot of work to do, and it’s good — only those who move forward see their horizons broaden.
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