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GP Global Equipment, a company registered in Singapore, will design and build a gas compressor station in Turkmenistan. On August 23, 2019 President Gurbanguly Berdimuhamedov signed an instruction sanctioning the Turkmengaz state concern to conclude the contract. GP Global Equipment will build the compressor station, with an annual capacity of two billion cubic meters, at the Zakli-Darvaza gas processing plant in the Central Karakum gas condensate field.
The decision was taken on the 23rd during a video conference involving Berdimuhamedov and members of the Turkmen Cabinet of Ministers. Local media described the planned deal as “further proof that Turkmen-Singaporean relations are moving to a qualitatively new level” and that “partnership is developing between the two countries in a range of sectors.”
The value of the contract has not been made public, but can be calculated approximately on the basis of similar projects. In 2005 the National Iranian Oil Engineering and Construction Company built the Korpeje gas compressor station, which has double the capacity, at a cost to Turkmenistan of €114 million. Meanwhile, the Frunze Science and Production Association, based in Sumy, Ukraine, built several turnkey projects for Turkmenistan in the late 1990s-early 2000s. Their gas compressor stations at Barsa-Gelmez, Goturdepe, Derelik, West Shatlyk, Yylanly, Nayip, Serdar, and Khazar have an annual capacity of between two and four billion cubic meters and cost between $100 and $150 million. Taking account of inflation and other factors, it can be assumed that GP Global Equipment will receive between 150 and 200 million U.S. dollars from the Turkmenistan state budget for Zakli-Darvaza – a sum large enough to warrant attention to the deal.
GP Global Equipment Private Limited was incorporated in Singapore in November 2015. Under Singapore law, a private limited company is exempt from submitting accounts and tax declarations, while its shareholders’ financial liability is limited to the size of the founding capital, which in the case of GP Global Equipment Pte Ltd is 100 Singapore dollars, approximately 73 U.S. dollars. None of its shareholders bears any liability for the company above that threshold, which begs the question: can such an important and expensive project be entrusted to a company that cannot be held fully liable if anything happens?
This is not GP Global Equipment’s first contract with Turkmenistan’s government. In 2007-2010 it built the Keymir gas-lift compressor station, which was commissioned by the state oil company Turkmennebit. The contract cost $136 million, but the company belonged to a different country, Great Britain.
A company with the same name, GP Global Equipment, is registered in Britain. The same company is also registered in Cyprus and now in Singapore too, and all these companies belong to one man, Russian citizen Igor Garankin.
Igor Nikolayevich Garankin (pictured) was born in 1975. From 1996 to 1998 he studied at the Russian Federation Foreign Ministry’s Diplomatic Academy. In 2001, he graduated from the Russian Academy of State Service under the Russian Federation President, defending his candidate degree dissertation on the subject “The dynamics and stabilization of investments in the functioning of agro-industrial enterprises.”
Not a great deal is known about Igor Garankin’s business activity, other than his cooperation with the Turkmen government. At present he is the general director of Medinvest limited liability company, which lists rentals and managing private real estate as its principal activity. According to data from the Russian Federal Tax Service, Medinvest’s annual profit does not exceed 1.8 million rubles (around $30,000). From 2005 to 2008 Igor Garankin also owned the Mexican Art company, a jewelry wholesaler, until it was wound up.
In August 2006 Igor Garankin started the business that brought him to Turkmenistan, registering GP Global Equipment in Great Britain, and a sister firm in Cyprus a month later. In July 2007 GP Global Equipment signed a contract for 136 million dollars with Turkmennebit for construction of the compressor station at the Keymir oil and gas field. This deal followed a tender, or at least, that’s what the Turkmen newspapers reported, though of course the tender might have been a fiction.
At that time Berdimuhamedov had only just come to power and was generously dishing out construction contracts to his newly formed inner circle of privileged businessmen. Not that it was an easy job to get into the inner circle, especially for a Russian – it required good personal connections to the Turkmen leadership, and, specifically, the support of the Turkmen president’s aide Viktor Khramov. According to his biography, Igor Garankin had no serious business experience or income at this time, so he must have used his father Nikolay Garankin’s money, connections, and influence to get his hands on the deal with the Turkmen government.
Nikolay Vasilyevich Garankin (pictured) was deputy governor of Moscow region from 1991 to 1993, a deputy and deputy chairman of Moscow regional duma from 1993 to 1994, and minister for land use and ecology in the Moscow Regional Administration from 1996 to 2000.
Like his son Igor, Nikolay Garankin studied at the Russian Academy of State Service under the President of the Russian Federation, where he defended two dissertations for the degrees of candidate and doctor of economics in the agricultural sphere.
The most notorious story involving Nikolay Garankin, which began to emerge in 1998, eventually led to his resignation from state service.
It concerned machinations to illegally fell forests for individual residential construction in the famous Moscow suburb of Nikolina Gora on the Rublevka highway. The then head of the Russian Presidential Administration, Pavel Borodin, “decided” the question of transferring 76 hectares of forest to a private developer for 168 billion rubles (around 17 billion US dollars), while Moscow region minister Nikolay Garankin supported the criminal decisions with his bogus resolutions, not just out of the goodness of his heart, of course. After the scam became public knowledge, he had to resign, but he kept his ill-gotten gains. It was widely covered in the then still relatively free Russian press.
In May 2001 Nikolay Garankin was caught up in a terrible scandal of a different kind. He and a relative – both drunk – went out for a drive in Garankin’s car through the leafy, elite suburb of Polyanki in Pushkin district, Moscow region, where Garankin has a house. His sister-in-law was at the wheel, though she couldn’t drive, and killed someone when she lost control of the vehicle. This was how Garankin senior celebrated his birthday.
Again, thanks to his connections in the Moscow regional administration and the leadership of the Russian law-enforcement agencies, Garankin senior managed to avoid criminal responsibility – he got away with just losing his driving license. This is the kind of family that was given access to state procurement in Turkmenistan. What made this possible?
The answer almost certainly lies with Russian oligarch Igor Makarov and his Areti international group of companies, formerly Itera.
Itera worked in Turkmenistan from the early 1990s. Initially it was mostly involved in gas trading, but after the halt in Turkmen gas supplies to Russia it changed direction to work in construction. Igor Makarov regularly visited Ashgabat over these years, especially since his contact on the inside, Turkmen presidential aide Viktor Khramov, had moved with the succession from Saparmurat Niyazov to Gurbanguly Berdimuhamedov. It was with the help of the Turkmen presidential aide that MRK-Engineering and Itera-Invest-Stroy, both part of the Itera group, received contracts for the construction of gas pipelines, industrial enterprises, sports complexes, racetracks, hotels, and other facilities.
Itera President Igor Makarov and his deputies Valeriy Otchertsov and Gennadiy Skidanov, both originally from Turkmenistan, were old friends of Viktor Khramov.
Before the collapse of the Soviet Union Valeriy Otchertsov was second secretary of the Ashgabat city committee of the Communist Party of Turkmenistan and deputy chairman of the Supreme Soviet of the Turkmenistan SSR. Then he became finance minister in independent Turkmenistan and was directly involved in establishing Itera on the Turkmen gas market. So directly that many experts are convinced that Itera from the outset belonged to Valeriy Otchertsov and not Igor Makarov. Only the need to conceal a conflict of interest for a senior government official forced Otchertsov to keep in the shadows and put Igor Makarov front and center.
Back in the day Gennadiy Skidanov took over from Otchertsov as second secretary of the Central Committee of the Young Communist League of Turkmenistan, when the latter moved up the ladder to more responsible positions in the party.
Viktor Khramov is himself a former communist too. Before being appointed secretary and aide to Saparmurat Niyazov in the late 1980s, Khramov worked in the communications and transport department of the Central Committee of the Communist Party of Turkmenistan. He remains an aide to the Turkmen president to this day, while his son Denis Khramov, who lives in Moscow, works for structures related to Itera.
You can read more about Itera’s role at the dawn of Turkmenistan’s state independence in the 2006 Global Witness report “It’s a Gas. Funny Business in the Turkmen-Ukraine Gas Trade”.
In August, the same month as the announcement of the GP Global Equipment deal, Igor Makarov received the official status of expert to the adviser of the Turkmenistan president on oil and gas issues. All the local media reported on Makarov’s appointment to this specially created position, stressing that he would play a key role in “realizing the national energy strategy aimed at modernizing and diversifying the sector, growing the potential of its refining infrastructure through the intensive introduction of cutting-edge technology.”
In Niyazov’s day Turkish billionaire Ahmet Çalık (left on photo) played a similar role as the Turkmen president’s special representative for the sale of natural gas, oil, and electricity on the Turkish market. Çalık, who made a fortune on state procurement in Turkmenistan, still works in the country but no longer holds an official state position.
When Berdimuhamedov became president, priorities clearly shifted in Russia’s favor, and a Russian billionaire took the place of the Turkish one.
Second, who really controls the corrupt, opaque oil and gas sector in Turkmenistan, including its Turkish end? Third, does anyone think that a Trans-Caspian pipeline and access to European markets for Turkmen gas against Moscow’s will are a realistic proposition?
It is not clear where the Garankins and GP Global Equipment fit into Khramov, Makarov, and Berdimuhamedov’s well established profiteering scheme.
The connection may well have been made back in 2000, when Itera acquired Sorochany, one of the largest downhill skiing resorts in the Moscow region. At that time Nikolay Garankin was a regional minister with a profitable sideline in land embezzlement. In 2008 Itera sold Sorochany for €250 million to its deputy chief executive Valeriy Otchertsov and his son Maksim. Sorochany is 250 hectares of land and around 350,000 square meters of residential and leisure property, including hotels, townhouses, villas, a golf course, moorings for yachts on the Yakhroma river, and much else besides. The same year, 2008, Itera stepped up its activity in Turkmenistan after a relative lull in the late Niyazov era.
There are conspiracy theories and there are facts – a small, obscure firm with a miserly founding capital, registered at three virtual addresses in Great Britain, Singapore and Cyprus but in fact belonging to Russians, receives a contract worth millions of dollars from the Turkmen government without even the pretense of a tender. This is not evidence that Turkmen-Singaporean relations have reached a qualitatively new level, as Turkmen propaganda claims, as neither the economy of Singapore nor the country itself has anything to do with this contract and will gain nothing from it. It is further evidence of cronyism and increasing Russian influence at the seat of power in Turkmenistan, as millions of dollars are handed to old friends behind a skillfully erected Singapore screen.
By Bayram Shikhmuradov and Ruslan Myatiev
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