POLITICS OF THE SOVIET ENERGY BALANCE: DECISIONMAKING AND PRODUCTION STRATEGIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80T00942A000600100004-4
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 95
• Document Creation Date: December 14, 2016
• Document Release Date: July 7, 2003
• Sequence Number: 4
• Publication Date: January 1, 1979
• Content Type: PAPER

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Assessment 25X1
Center
Politics of the Soviet
Energy Balance:
Decisionmaking and
Production Strategies
Confidential
RP 79-10004
January 1979
Copy 4 91
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Assessment 25X1
Center
Politics of the Soviet
Energy Balance:
Decisionmaking and
Production Strategies
25X1
Confidential
RP 79-10004
January 1979
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Politics of the Soviet
Energy Balance:
Decisionmaking and
Production Strategies
Soviet leaders, especially those closely in touch with
the economy, have been aware since well before the
Western oil crisis of 1973-74 that they had a far more
serious energy problem than they were prepared
publicly to acknowledge. Nevertheless, the year 1977
appears to have represented a watershed in their
appreciation of just how serious the problem really is.
By that time, the magnitude of the energy transporta-
tion problem caused by the rapidly increasing fuel
deficit in the European USSR was becoming fully
apparent. The immediate reasons for increased anxiety
included the deterioration of the ratio of oil reserves to
production, the failure of geologists in West Siberia's
Tyumen Oblast to meet the plan for increasing oil
reserves, the inability to bring on stream the planned
number of new small oilfields in Tyumen, shortfalls in
production in a considerable number of older oil
regions, and energy shortages throughout the econ-
omy. At the December 1977 Plenum of the Central
Committee, with Brezhnev's endorsement the Soviet
leadership significantly altered the energy policy that
had underpinned the 10th Five-Year Plan (1976-80)
and accelerated development of oil and gas production
in Tyumen Oblast.
There has never existed what could properly be called a
comprehensive and operative Soviet energy program.
There have been various studies, recommendations,
and forecasts; there have been many research and
development (R&D) projects; and there have been
compilations of one-year and five-year plan targets
that have naturally involved individual capital con-
struction projects with long leadtimes. But energy
production decisionmaking has not been seriously
influenced by any carefully elaborated and stable
"master plan." Nor have there existed operative long-
term, integrated programs for attacking such key
energy production problems as Tyumen oil develop-
ment, offshore oil production, Tyumen gas develop-
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ment, or Kansk-Achinsk coal development. The proc-
ess of decisionmaking with respect to these critical
production areas is far more ad hoc than is customarily
assumed by either Soviet propagandists or many
Western analysts.
The center of gravity in energy decisionmaking over
the past decade has lain in the Council of Ministers -
State Planning Committee (Gosplan) sphere. There is
no evidence that the Politburo or the Central Commit-
tee Secretariat has routinely taken the initiative in
energy production policy matters. Premier Kosygin has
been the top official responsible for energy production.
Other key figures have included Council of Ministers
Deputy Chairmen Vladimir Novikov and Veniamin
Dymshits, who have exercised day-to-day supervision
of the energy production ministries; Gosplan Chair-
man Nikolay Baybakov; and Chairman of the State
Committee for Science and Technology Vladimir
Kirillin. Vladimir Dolgikh, the Central Committee
secretary responsible for heavy industry, has
monitored energy production along with many other
sectors of the economy which fall within his jurisdic-
tion from the party side. On occasion the party
Secretariat does intervene in energy production
policymaking, as it did most recently in December
1977. Fundamentally, however, power in energy pro-
duction decisionmaking remains diffused among
various leaders and institutions; there is no point at
which all the strands of influence come together.
The economic and political system in which energy
production policymakers and administrators operate
compels them to be highly responsive to short-term
considerations at the expense of proclaimed long-term
objectives. Top-level policymakers and advisers tend to
hedge their bets and avoid unqualified commitment to
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any single policy proposal. They are sensitive to
currents of elite opinion and avoid overadvocacy of
positions that will isolate them or endanger their
bureaucratic or political careers. High-level energy
administrators are concerned above all with ensuring
conditions that will make it possible to slightly
overfulfill the one-year targets for which they are
responsible. Consequently, they tend to avoid any
technological innovation that threatens to set back
annual plan fulfillment.
Top energy policymakers are extremely dependent on
advisers and specialists, who provide most of the basic
information and play a critical role in defining the
options. Unbiased advice, however, is a scarce
commodity because most advisers and specialists have
vested interests defined by the institutions, research
programs, and career systems with which they are
associated.
Policy decisions on energy production customarily
emerge from a labyrinth of bureaucratic and personal
negotiation, in which committee discussion and formal
interorganizational coordination play an important
role. Within the limits set by circumstances that
cannot be ignored, policy is more a resultant of the play
of institutional and personal interests than the outcome
of a rational appraisal of the objective situation. On the
whole, the system tends to respond slowly to new
conditions. Although campaigns to meet changing
situations are often mounted, incrementalism is a
deeply ingrained principle of energy planning.
During the past decade Soviet energy policymakers
and advisers have discussed a range of responses to the
growing energy problem. The spectrum of options
considered runs from (1) simply increasing oil and gas
production, to (2) sharply raising the share of gas in
the energy balance, to (3) stabilizing and then
gradually decreasing the share of hydrocarbons, simul-
taneously increasing the share of coal and nuclear
power, to (4) going all out for coal. The preferences of
policymakers and advisers have to some extent shifted
with the passage of time. Options 1 and 2 have always
been supported by a cluster of party and production
officials with a career interest in Tyumen Oblast,
backed up by some Siberian scientists. It is possible
that these officials have received some encouragement
over the years from the Central Committee Secretar-
iat-perhaps even from Brezhnev. Option 3 has been
favored in recent years by Premier Kosygin, all the top
Academy of Sciences energy advisers, Gosplan Chair-
man Baybakov, Chairman of the State Committee for
Science and Technology Kirillin, some ministers, and
party and production leaders in Siberia's Krasnoyarsk
Kray. Option 4 has been entertained by some Academy
of Sciences figures and supported by certain specialists
associated with the coal and electric power industries.
There has been much vacillation and indecision in
energy production policy. From a faith that the share
of oil and gas in the energy balance would gradually
continue to rise, Soviet authorities shifted in the early
1970s to the hope that a big leap in gas production
might prove to be the answer; by 1975-76 a broadly
based strategy keyed to oil and gas in the present, coal
in the middle term, and nuclear power in the longer
term was approved as the party line, but by late 1977
policy had changed to embrace a narrower, all-out
campaign simply to develop oil and gas production in
Tyumen Oblast over the next decade. And even the
adoption of the most recent line has not stilled
proponents of both the coal-nuclear and gas alterna-
tives. It is likely that Kosygin, Baybakov, Kirillin, and
most Academy of Sciences energy advisers were
unhappy with the way policy was altered at the
December 1977 Plenum of the Central Committee.
While they are probably prepared to acknowledge that
under present conditions there is no choice but to
attempt to accelerate hydrocarbon production in West
Siberia, they probably fear that the current campaign
will undermine the pursuit of crucial longer range
goals.
The change of direction at the December 1977 Plenum
of the Central Committee and the retreat from the
strategy of the 10th Five-Year Plan indicate the
extreme difficulty the Soviets are having in sustaining
a balanced response to long-term energy development
needs and short-term demands for petroleum. Since
1976 there has been a definite foreshortening of the
energy horizon and even greater fixation on meeting
today's needs, come what may in the future.
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At the moment the Soviets are engaged in a relentless
struggle to maintain oil output in the key West
Siberian region by increasing drilling and recovery in
Samotlor and other older Tyumen deposits, and to
raise the level of output by opening up smaller Tyumen
fields. The prospects for success are highly tenuous.
Samotlor, which at present produces about one-quarter
of all Soviet oil, is being driven beyond its planned
capacity and will thus go downhill more rapidly when
it begins to decline in several years. The small fields
are in increasingly inaccessible locations, are substan-
tially less productive than Samotlor, and require
progressively rising investment. They are not being
brought on stream as rapidly as required. The Tyumen
campaign may be predicated to some extent upon the
hope that one or more new supergiant oil deposits will
be discovered either in the Middle Ob region or
beneath the gasfields in northern Tyumen. Yet there
has been a critical lag in geological exploration of the
region and Soviet policymakers consequently lack a
sound basis for even guessing whether oil is to be found
in these locations. The presence or absence of such oil
has been hotly debated. Probably a majority of Soviet
experts disagree with those geologists now ascendent
who guarantee they can find oil in these places if given
the resources.
Over the past decade the Soviet leadership has been
unable to force a technological breakthrough in even
one type of new system that could provide an answer to
the increasingly critical problem of transporting Sibe-
rian energy to the European USSR. Given the long
leadtimes involved, this failure seriously jeopardizes
any possibility-however slight it may now be-of
large-scale substitution of gas or coal for oil in the
1980s. Whether Soviet R&D organizations will be
able to devise means of chilled or liquefied gas
transportation in time to have an effect in the 1980s is
highly problematic. Delays in solving the extra-high-
voltage transmission problem, in developing either
slurry or capsule pipelines, in implementing any one of
several proposed coal-processing techniques, and in
producing power-generating equipment adapted to
Kansk-Achinsk coal now push a possible "coal alterna-
tive" well off into the 1990s.
Without a significant increase in the share of invest-
ment going to energy production, it is difficult to see
how the Soviets can do much to transform the
parameters of the dilemma that now confronts them.
They must make an increasingly heavy commitment of
resources to oil production in Tyumen because they
must have the oil; without additional investment being
allocated to the energy sector as a whole, this will tend
to retard progress toward either a gas- or coal-based
solution to the energy problem, and delay in developing
these alternatives will generate still more pressure to
maintain the existing proportion of oil in the energy
balance-despite the day of reckoning that must come
unless a new supergiant oil province is quickly discov-
ered. Brezhnev's speech at the November 1978 Plenum
of the Central Committee suggests that energy-related
investment may be given a higher priority during the
remaining years of the present five-year plan. Because
the physical resource demands of energy production
fall heavily upon the metallurgical, machine-building,
construction, and transportation sectors, pressures
may mount to make compensatory cutbacks not only in
the traditional buffer sectors of agriculture, housing,
and light industry, but in military production as
well.
The question of foreign dependency has probably
become more acute with the introduction of the new
party line. The strategy propounded by Kosygin and
Baybakov in 1976, with its stress on nuclear power,
coal, and hydroelectricity, was presented, in almost so
many words, as the Soviet "Project Independence."
The retreat from this strategy in December 1977 may
have compromised the longrun objective of avoiding
external structural vulnerability in energy matters. By
playing down the policy commitment to coal and
nuclear power, perhaps to avoid cuts in military or
agricultural spending, Brezhnev has implicitly
heightened the already urgent Soviet need for a broad
range of onshore and offshore oil and gas technology.
More important, any slackening in the expansion of
coal production and nuclear generating capacity that
might arise as a byproduct of the current strategy
threatens to leave the Soviet Union in the latter 1980s
and in the 1990s with an extremely tight energy
situation, if not a serious energy deficit. It is apparently
this forbidding prospect of a deficit, not the question of
dependence on Western technology acquisition, that
has most disturbed Kosygin.
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In the future the Soviets are likely to try to revive the
gas strategy. Provided gas reserves are even close to
being as large as officially claimed, a quantum leap in
Tyumen natural gas utilization would be the only way
a really rapid increase in fuel production could be
brought about. This approach, however, would place
an acute strain on the steel and gas and oil machine-
building industries. Foreign supply of credits, large-
diameter pipes, and compressors might well prove to be
even more critical at this juncture than at present.
The Soviet leadership may also search for organiza-
tional solutions to its energy dilemma. The most likely
prospective courses of action would be the creation of a
Politburo-level committee responsible for monitoring
energy problems and/or the appointment of a Central
Committee secretary responsible solely for energy
affairs. But neither change would significantly im-
prove the leadership's capability for dealing with the
energy problem.
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The Environment of Energy Decisionmaking 3
The Structure of Power in Energy Decisionmaking 4
The Process of Energy Decisionmaking 17
Alternative Strategies 18
The Present Tyumen Oil Campaign 32
Urengoy Gas Development 37
Alternative Strategies for Dealing With the Energy Problem 47
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This paper examines the way in which the Soviets have
dealt with energy production issues, rather than
quantitative aspects of the Soviet energy question.
Given the fusion of political and economic issues and of
policymaking and bureaucratic implementation in the
Soviet system, there can be no tidy demarcation of the
"politics" and "economics" of energy production.
Essentially, "politics" occurs wherever there is an
element of choice with respect to policy or execution.
While such choices are often resolved at the very top,
the complex technical nature of energy issues and the
strong bureaucratic and personal interests involved
create a setting in which outcomes may be significantly
affected by what is happening at middle or even lower
echelons.
The present paper complements recent CIA analyses
of the Soviet energy situation that have focused on the
oil industry. CIA projections of Soviet oil output have
provoked considerable debate. They have been ques-
tioned less on empirical, technically based grounds
than on the grounds that they overlook certain features
of the Soviet natural resource and political-administra-
tive environment. It is argued, directly or indirectly,
that CIA projections:
? Pay insufficient attention to the vast potential energy
resources still untapped in West Siberia, East Siberia,
and offshore.
? Fail to recognize the capacity of the Soviet system to
reach hard decisions in energy policy and then-
through command planning and mass mobilization-
to implement them.
? Discount the ability of Soviet planners to diagnose
their own energy production problem and come up with
a coherent, long-term "rational" energy strategy.
This study looks at Soviet perceptions of the energy
resource problem and concludes that informed
authorities are far more concerned about energy
production than official spokesmen publicly or pri-
vately suggest. The paper addresses the following
questions:
? How serious is the energy problem perceived to be?
? Who makes energy production policy?
? What are the basic motives and features of
decisionmaking in the energy production field?
? What alternative strategies have been advocated for
meeting the energy problem?
? What choices has the leadership made in recent
years and how effectively are present policies be-
ing implemented?
The evidence on these questions strongly indicates that
the Soviets are not at all sanguine about tapping their
energy potential with sufficient speed to avert serious
shortages; that a unitary, "rational actor" decision-
making model provides a poor basis for understanding
what has happened in recent years in energy produc-
tion policymaking; and that a coherent, long-range
strategy continues to be lacking. There are good
reasons to suppose that the situation is not likely to
improve during the forthcoming Soviet leadership
succession.
The study is divided into five main sections. The first
explores the evolution of Soviet perceptions of the
energy problem in recent years. The second examines
the environment in which energy decisionmakers
operate and the impact of this on the process of
decisionmaking. A third section provides a summary
view of controversy over energy production policy
during the past decade. The fourth part analyzes the
impact on policy of the December 1977 Plenum of the
Central Committee and describes what has happened
during 1978. The last section discusses prospects for
the future. Details of debate over energy production
strategy durin the 1970-77 period are present in the
appendix.
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Politics of the Soviet
Energy Balance:
Decisionmaking and
Production Strategies
1. Soviet Perceptions of the Energy Problem
What the Soviets have really thought about the energy
problem at any given time is not easily determined.'
Nevertheless, there has clearly been a growing diver-
gence between the mass propaganda line that energy
problems cannot occur in a Soviet-style planned
economy and anxiety developing over the situation
among even moderately well-informed elements of the
population. In Academy of Sciences and intelligentsia
circles there has been an awareness of projections in
the West of a rapid global exhaustion of conventional
energy resources. However, only a handful of
individuals have acknowledged-at least implicitly-
that even the Soviet Union, with its socialist system of
centralized planning and enormous natural resource
base, is not immune to the "energy crisis." 2
A majority of informed Soviet specialists have prob-
ably dismissed the possibility of a full-blown "energy
crisis" on the presumption that vast oil, gas, and coal
reserves will be found in Siberia and offshore. The
energy problem has been seen fundamentally as a
transportation problem. But within this perspective
there has been a growing comprehension since at least
the early 1970s of the ever-increasing deficit of fuel-
energy resources in the European USSR and the
dependence of the Soviet economy on massive ship-
ments of energy supplies from Siberia to the west. This
awareness has been reinforced by frequent electrical
power shortages, breakdowns in natural gas deliveries,
and petroleum shortages that have claimed the atten-
tion of all the top leaders concerned with ener y, from
Kosygin down.
Particularly vexing concerns since the early 1970s have
been the declining reserves-to-production ratio in the
oil industry, water encroachment, and the failure to
discover new supergiant oil deposits. The most alarmist
noises on this score were voiced by the late Minister of
Oil Valentin Shashin, who from the late 1960s until his
death in 1977 publicly called attention to the urgent
need to discover new oilfields. Shashin's warnings may
have been discounted in some quarters as a self-serving
attempt to get lower production targets for the
Ministry of Oil. But other people were also making the
' The difficulty arises in part because the circle of officials who have
a comprehensive and accurate appreciation of the overall Soviet
energy picture is probably quite small, and these individuals may
well keep their opinions to themselves. There is some question as to
how much distortion of reality occurs in the statistics furnished to
energy decisionmakers. Access to the information necessary to reach
an informed judgment appears to be restricted within each
production branch, and overview data are probably even more
closely held. Many higher Soviet officials and academics with whom
Westerners have talked are unlikely to have had access to such
data. Moreover, awareness of the extreme political sensitivity of
pessimistic energy production information has probably led to
deliberate distortion both in public propaganda and "confidential"
communications with foreigners. It may be that informed Soviet
authorities hesitate to express serious misgivings about the ener
situation even among themselves.
'The most prominent public exponent of this view is the famous
physicist, Academician Petr Kapitsa, who has used the argument to
lobby for more rapid development of nuclear power. Citing The
Limits of Growth by Dennis Meadows and colleagues, Kapitsa
observes that "the inevitability of a global energy crisis is now fully
recognized, and therefore the energy problem has become for
technology and science problem number one." (Vesinik ANSSSR
1976, No. 1, pp. 34-35.) A well-known coal-processing specialist,
Zinovii Chukhanov, has also used the Academy's journal to argue
forcefully, if somewhat indirectly, that a serious energy crisis is
inevitable in the USSR unless coal substitution takes place on a lar e
scale. (Ibid., 1976, No. 9, pp. 105-109.
same point.
Overall, there have been signs of a steady increase in
top-level concern over the energy problem, although
more optimistic assessments have continued to appear.
At least a year before the Middle East war and oil
embargo of 1973, the evidence indicates that the Soviet
leadership was well aware that it had a major problem
on its hands. In October 1972, in a speech to the State
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Committee for Supply, Kosygin placed unusual em-
phasis on the need to conserve fuel-energy resources,
and at the December 1972 Plenum of the Central
Committee a decision was taken to accelerate the
development of electric power, oil, and gas in 1973
because of the threat of an energy lag and its potential
impact on the entire economy. At about this same time
a so-called Big Commission was organized, under the
chairmanship of Academician Mikhail Styrikovich, to
explore all possible solutions to the energy problem.
Subcommissions were established under it to in-
vestigate possible courses of action-some quite
visionary. '
A year later, in late 1973, at the very moment the
Soviet press was gloating over the energy discomfiture
of the West, the Politburo was engaged in a highly
critical review of the situation in the oil, gas, and oil-
refining industries, which resulted in a decision to take
further steps to improve energy production.' This
reassessment was reflected in pronouncements at the
December 1973 Plenum of the Central Committee, in
extremely pessimistic statements by production offi-
cials at a gathering in December 1973,5 and again in
Deputy Chairman of the Council of Ministers
' It was proposed, for example, that natural gas be transported out of
West Siberia in 5-kilometer-long "trains" of dirigibles, or through
floating polyethylene "pipes" anchored to the ground every 30 km.
One of the subcommissions, headed by the chairman of the Yakutsk
branch of the Academy of Sciences, Nikolay Cherskii, worked up a
proposal for the capsule transport of natural gas from Tyumen that
was later encouraged by a Council of Ministers resolution in 1974.
Another subcommission appears to have been set up under Academi-
cian Lev Melent'ev's supervision and with the Institute of High
Temperature's participation to evaluate the future role of nuclear
power.
'The Politburo review almost certainly called for an intensified
analysis of the energy problem: an unprecedented general assembly
of the Academy of Sciences devoted to the energy problem was held
in November 1974, and around this time an Institute of Complex
Fuel-Energy Problems was established in the State Planning
'According to the Minister of Power and Electrification, Petr
Neporozhniy, the European USSR was experiencing a "power
hunger," there was insufficient fuel to operate power stations at full
capacity, power could not be shifted efficiently from Siberia to the
western part of the country, and construction of new power stations
Veniamin Dymshits' sharp criticism of the Oil Minis-
try at its annual winter meeting in early 1974. Some of
this concern was probably provoked by a desire to
capitalize more fully upon higher world oil prices, but
domestic supply shortages appear to have been an
equally important factor. The seriousness with which
the energy problem was being treated at the time,
however, was deliberately masked in the dealings of
Soviet leaders with outsiders.
In 1975-76 there were more discussions of the energy
problem, more signs of concern, and more decisions-
all focusing on the 10th Five-Year Plan (1976-80). At
the 25th Party Congress in March 1976, which
confirmed a preliminary outline of the 10th Five-Year
Plan, Kosygin indicated his uncertainty concerning the
"reliability" of energy supplies and called for more
rapid development of fuel reserves in order to guaran-
tee against "lack of energy" some time "in the future."
The 10th Five-Year Plan itself was not finally ap-
proved until October 1976, and this delay has been
attributed by some to a failure to resolve energy issues.
At the October 1976 Plenum of the Central Commit-
tee, which confirmed the plan, Brezhnev declared that
energy demands were outstripping resources and that,
consequently, it was necessary to set supplementary
targets for oil, gas, and coal production and to
"introduce rigid coefficients of [fuel] expenditure."
Shortly after the Plenum, a joint Central Committee -
Council of Ministers resolution was issued that called
for more rapid preparation of oil, natural gas, and gas
condensate reserves in West Siberia.
Thenceforth, throughout 1977, there were consistent
indications of high-level anxiety over energy supplies.
At the meeting of a Ministry of Oil Collegium in early
1977, Dymshits revealed that nonfulfillment of the
supplementary plan for 1976 had "created certain
difficulties in supplying the economy with fuel" and
called for a crash pipeline program. Within Gosplan,
the Soviets explored the question of increasing some-
what the small quantities of oil already being pur-
chased abroad. Both Gosplan Chairman Nikolay
Baybakov and Kosygin indicated a pressing interest in
moving rapidly into offshore oil exploration and
development. President of the Academy of Sciences
Anatoliy Aleksandrov referred in June to the serious-
ness of the oil situation and the difficulty of resolving
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disputes over the proper strategy to pursue. "At the
present time," he declared, "our energy production is
in a very complex stage of development." Over the
longer run, without a shift to coal, he foresaw that the
Soviet economy would "encounter great difficulties." 6
And in November, "fundamental shortcomings" in the
fuel energy sector were castigated at a Su reme Soviet
planning-budgetary commission meeting.
To say that individual Soviet leaders are aware that a
serious energy supply problem exists is not to say,
however, that the decisionmaking process in which
they are collectively caught up has been able to
respond effectively to the perception of danger.
II. Soviet Energy Decisionmaking
Soviet energy officials work in a special environment
and are compelled to respond to the cues this environ-
ment provides, even when the resulting behavior is
irrational from the standpoint of the regime's professed
objectives, of our own projections of what "they ought
to do," or of the officials' own common sense. In this
respect the situation in energy is no different from that
in other areas of the economy, despite the high priority
of energy. The cues are a product of deep-seated
structural features of the Soviet economic and political
system that have proved highly resistant to change.
Among the relevant economic factors are:
? The overwhelming pressure to meet this year's plan
or satisfy current needs at the expense-if need be-of
longer term interests. Meeting short-term demands is
what determines an official's reputation, job prospects,
and material well-being.
? The secondary significance of genuine cost-effi-
ciency as a criterion of individual or organizational
success.
6 Aleksandrov's comments were printed in Vestnik AN SSSR 1977,
No. 6, pp. 14-15.
? The chronic overcommitment of resources, lack of
balance between planned inputs and projected outputs,
and certainty of shortages.
? The unreliable quality of intermediate goods.
? The risks of major technological innovation. Techno-
logical innovation means new, untested dependencies,
new unreliable supplies, new personnel patterns, and
almost certain delay. Running these risks is not
rewarded.
? The pervasive rule-breaking and illegality required
to fulfill economic plans.
? The severe shortage of highly valued goods: satisfac-
tory housing, quality food and clothing, automobiles,
and the opportunity for foreign travel.
To these features of the economic environment must be
added a number of political factors that are simply part
of the landscape for Soviet officials:
? The absence of desirable or calculable career options
outside the bureaucratic track. Although some offi-
cials find a safe haven in the Academy of Sciences, for
most there is only one game to play-the one they are
already in within a given organizational milieu.
? Vulnerability to "political" charges. Despite the very
real "erosion of ideology" that has occurred in Soviet
society, officials must anticipate and hedge against the
possibility of being victimized by political "label
sticking." '
? Vulnerability of all officials to instant removal from
their jobs outside of normal channels through the
party-dominated system of personnel control. There
economy
' In the energy area some sins to be avoided include jeopardizing
Soviet independence in the international arena through indebtedness
or technological dependence; selling out the natural resource
patrimony of the country; kowtowing to foreign technology and
"underestimating" the quality of domestic efforts; failing to
recognize that the Soviet system of centralized economic planning
protects it from the "energy crisis" of Western capitalism; or
underestimating the imperialist danger and encroaching upon
the resources and investment needs of the defense sector of the
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has been far less of this intervention since 1964 than
there was under Khrushchev, but it remains a source
of anxiety.
? The omnipresence of informal sponsorship, protec-
tion and patron-client relationships.
construction and transportation. On the personal level
there is a deliberate and intense cultivation of connec-
tions with subordinates, peers, and superiors, both for
self-promotion and as a guarantee against adversity.
I- I
In combination, these two sets of factors evoke certain
characteristic behavior patterns that strongly influence
energy decisionmaking. The positions Soviet de-
cisionmakers take on issues tend to be responses to
immediate role pressures, rather than responses moti-
vated by "statesmanlike" concerns-ideological, patri-
otic, or otherwise, although these concerns do indeed
exist. Because of the constraints imposed on acknowl-
edging short-run "departmental" or personal "career-
ist" aims, a constant masking or rationalization of
vested interests takes place in policymaking and
execution.
Soviet policymakers address immediate demands and
seek solutions that will work in the near future; they
are compelled to adopt a shortrun point of view. As
Party Secretary Vladimir Dolgikh put it, "I have to
have a piece of black bread today, right away. I can't
think about what's going to happen tomorrow." At the
same time there is a strong tendency, in the Soviet
jargon, to "reensure." While top Soviet officials will
vigorously push their own departmental interests, in
general they seek to avoid controversial policy stands
that could lead to their isolation from other officials.
By and large this sensitivity to which way the wind is
blowing has been a crucial element in the career
success of these officials. The broader the responsibil-
ities of a leader, the more cautious and consensus-
oriented his behavior is likely to be. A premium is
placed upon forging favorable or at least benign
relations with other institutional power centers, some-
times through means that verge upon corruption.'
Simultaneously, production officials attempt to reduce
the dependence of their own units on other organiza-
tions by pursuing autarkic measures in such fields as
' A good example, which also illustrates the way informal influence
can distort the structure of operational command, is found in the
relation between Gosplan energy departments and the ministries.
The ministries, which have a larger quota of foreign exchange
allocated for trips abroad than their putative planning superior, offer
placement on delegations abroad to promote more accommodating
The Structure of Power in Energy Decisionmaking
In analyzing Soviet energy decisionmaking it is useful
to distinguish among three types of power: formal
authority, operational command, and influence. Each
of these is based on certain resources, and each is
significant in its own way. The institutional reflection
of this pattern of power is shown in the accompanying
foldout chart. Formal authority attaches, above all, to
the party Politburo-the highest policymaking body in
the Soviet system of rule. Operational command is
associated with the Central Committee Secretariat
and departments, the Presidium of the Council of
Ministers, Gosplan, and to some extent the various
ministries involved in energy production. Influence is
wielded by the Referentura of the Council of Ministers
(a subunit within the Council of Ministers' Adminis-
tration of Affairs), a number of ministries, the State
Experts' Commission and institutes of Gosplan, the
State Committee for Science and Technology, the
State Committee for Utilization of Atomic Energy,
certain branches of the Academy of Sciences, and
regional authorities.
As elaborated below, there is a major disjunction
between the structure of formal authority and the
structures of operational command and influence.
Some interlocking of operational command and influ-
ence takes place by virtue of the roles performed by key
figures like Chairman of the Council of Ministers
Kosygin, Gosplan Chairman Baybakov, and-to a
lesser extent-Central Committee Secretary Dolgikh,
who is responsible for heavy industry. The net effect is
probably to place the center of gravity of energy
production decisionmaking in the Presidium of the
Council of Ministers - Gosplan sphere. However,
power in energy decisionmaking remains diffused
among leaders and institutions: there is no point at
which all the strands come together.
relations with those Gosplan officials whose decisions on plan tar ets
and supplies are critical for the ministries' own success.
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 Soviet Energy Production Decisionmaking
------------
Meeting of Secretariat
Secretary for
Heavy Industry
Heavy Industry Department
Sectors
Petroleums
Coal
Geology
Other
Territorial Party
Committees
Council of Ministers
Presidium
------------
Chairman
Deputy Chairmen with
Energy Responsibilities
F-
Energy
Commission
F Chairman
Deputy Chairman
for Energy
Meeting of Collegium
State Committee for State Committee for
Utilization of Science and
Atomic Energy Technology
6 t
Academy of Sciences
Presidium
------------
President
Vice Presidents
Members
Departments
Ministry of Oil
Petroleum and Gas Industry
Coal
i
d El
ifi
on
ectr
cat
Power an
Geology and Mineral
Ministry of Gas
Resources
Division of
Commission for the
I
Transport
Nuclear Physics Study of
Production Forces
4 and Natural Resources
State Experts'
Kurchatov Institut~
Ministry of Coal
Commission
Institute of Geology
L Scientific Council on and Geophysics
Division of 1 Complex Problems
Ministr
of Power
Council for the Study of
Physical-Technical of Power
y
and Electrification
Production Forces (SOPS)
Problems of Power I Institute of Economics
and Organization
1
of Production
Institute of Complex
# Ministry of Geology
Fuel-Energy Problems
=Formal Authority __ Command
=Operational Command - - - Coordination
=Influence -Consultation
Institute of Comex
Exploitation of
Mineral Resour s
Division of Geolo
Geophysics and
Geochemistry
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Formal Authority
The Politburo. The Politburo's authority gives it a
potentially decisive voice in energy affairs. It has the
ultimate right to approve or disapprove policy propos-
als set before it; it has the right to demand accountabil-
ity and information from all officials; and it has the
final say on the promotion, tenure, and demotion of top
leaders, including those who belong to the Politburo
itself. To some extent it does bring these resources to
bear on energy matters. It confirms the basic energy
policy lines that are expressed in annual and five-year
economic plans, determining in this manner the share
of resources to be allocated to energy development. It
probably serves as a forum for occasional top-level
discussions of key energy projects. And it may become
involved in settling serious interorganizational
disputes.
policy review, verifies the fulfillment of policy deci-
sions already adopted, and oversees personnel appoint-
ments. But the available evidence, which is far from
adequate, suggests it is unlikely that the Central
Committee apparatus has participated very actively
in the search for basic solutions to Soviet energy
problems. Most of its time is probably devoted to
monitoring and intervening in current production
activities.
There is no evidence that Brezhnev, as General
Secretary, has assumed the same kind of sustained
operational control in the energy field that he has in
military and security affairs, foreign policy, or agricul-
ture.' In recent years Andrey Kirilenko has been the
only Central Committee secretary directly responsible
for industrial matters who has simultaneously been a
member of the Politburo. While it is known that in the
past he has participated occasionally in decisions
related to energy production, there is no evidence that
he has been involved on a regular basis in energy
production policymaking in recent years. Kirilenko's
main connection with energy problems appears to be in
the field of fuel conservation, in which he is currently
There are, however, real limitations on the effective
power of the Politburo in energy matters. It is a
committee made up of persons whose occupational
responsibilities and organizational base of operations
generally lie elsewhere. It divides its attention among a
multitude of questions, many of which have had far
greater immediacy than energy. It is not known to have
any special subgrouping for energy affairs-in con-
trast, for example, with its arrangements for handling
military-security affairs. Basically it lacks expertise in
energy issues. While a number of members have had
peripheral contact with energy questions as regional
bosses, only Kosygin among the full members and, to a
lesser extent, RSFSR Premier Solomentsev and First
Deputy Chairman of the Council of Ministers Nikolay
Tikhonov among the candidate members, have had
prolonged experience in supervising energy affairs.
Thus the Politburo is largely dependent upon external
sources of information and advice; as an institution it
cannot be considered a source of energy policy
initiative. Probably it deals with energy issues only
episodically. At best, it chooses from among competing
policy options.
Operational Command
The Secretariat. Operational command in energy, as in
other matters, is shared between the Central Commit-
tee apparatus and the Council of Ministers. In
principle the Central Committee apparatus spearheads
playing a visibly active role.
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Only two other Central Committee secretaries deal
with industrial affairs: Yakov Ryabov, who handles
defense industry, and Vladimir Dolgikh, the secretary
responsible for heavy industry. Dolgikh, who also
heads the Central Committee's Heavy Industry De-
partment and personally supervises those sectors
within it that deal with energy questions, is clearly the
' He did obviously take the lead in December 1977 in changing the
policy line on the energy balance approved in March 1976 by the
25th Party Congress, and in the subsequent campaign to promote
faster oil and gas development in Tyumen Oblast. And he has been
known on occasion to have issued direct orders connected with
energy matters. But over the years he has probably addressed
himself to energy problems largely within the context of broader
issues: discussion of annual and five-year plans, the general question
of efficiency of the economy, the development of regional production
"complexes," and Soviet relations with Eastern Europe and the
capitalist West.
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official in the Secretariat primarily responsible for
energy production.10
Dolgikh's role and that of the sectors for geology, coal,
and petroleum in the Heavy Industry Department are
among the least publicized in the entire area of energy
administration, and our knowledge of them is based on
fragmentary information. As the Secretariat's energy
controller, Dolgikh has potentially been in a strong
position to influence energy production policy and
implementation. He is the highest party leader dealing
routinely with officials in the Council of Ministers
responsible for energy matters
Appeals related t -energy development
trecte to the Central Committee over the years by
provincial party and economic leaders as well as by
central government officials have raised both policy
and implementation issues. These appeals suggest that
the power to issue orders to Gosplan and individual
ministers, if not to the Presidium of the Council of
Ministers and Kosygin personally, lies with the Secre-
tariat and the Central Committee departments, al-
though how actively this power has been exercised is
moot. It is probable that significant policy innovations
originating in the Council of Ministers or below it are
routinely coordinated with the Central Committee
apparatus before being brought up for final decision at
meetings of the Presidium of the Council of Minis-
ters."
10 Dolgikh is a metallurgical mining engineer by training and served
most of his career in Krasnoyarsk Kray of central Siberia. He
probably owes his rapid promotion to the Central Committee
Secretariat, in 1972, to the sponsorship of Kirilenko and perhaps of
Brezhnev as well. Within the Secretariat his jurisdiction, in addition
to the energy area (oil, gas, coal, and electric power), has included
geological exploration, nonfuel extractive industries, ferrous and
nonferrous metallurgy, the chemical industry, some branches of
" Traditionally, it has been the practice to call upon individual
republic and oblast party committees to give a formal accounting of
their activities before the Secretariat, and these accounts are
preceded by an investigation conducted by Central Committee
apparatus personnel. When the regions selected have been major
bases of fuel production, the lengthy resolution that customarily caps
the entire process in effect sets a party "line" that must be taken into
account by Gosplan and the branch ministries in decisions related to
Unquestionably, there have been good reasons for
officials in the Council of Ministers to check first with
Dolgikh and the Central Committee Heavy Industry
Department, to seek support from them, and to heed
their "suggestions." 'Z Yet the available evidence does
not indicate that Dolgikh has played as active a role in 25X1
energy production policy as one might suppose. He has
not made major public speeches on energy issues or
published articles devoted specifically to this field]
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It must be emphasized, of course, that the evidence
here is thin and largely negative in nature. Still, there
are plausible reasons for Dolgikh and his subordinates
to have exercised less influence over energy affairs
than has been true of Secretariat involvement in such
fields as agriculture or ideological affairs.
Lacking even candidate membership in the Politburo,
Dolgikh's personal political status is far lower than
that of Kosygin-the ultimate authority on energy in
the Council of Ministers. Moreover, Dolgikh's span of
control has been so broad that he has probably been
able to devote only a fraction of his time to energy
matters. His professional experience in the nickel
industry, while having some bearing on fuel extraction,
could hardly have given him an edge in discussions
with Kosygin, who has been dealing with energy issues
for at least two decades, or with Gosplan Chairman
Baybakov, who spent most of his career in the oil
industry, or with any of the energy branch ministers, or
with specialists in the Academy of Sciences. Nor is it
clear that Dolgikh has wanted to exert great influence
on energy policy.
12 Dolgikh has had the ear of Brezhnev and Kirilenko, and has the
responsibility of making policy recommendations to the Secretariat,
and through the Secretariat to the Politburo itself. He has certaintly
been in a strong position to obstruct actions proposed within the
Council of Ministers. And he also has probably had a major voice in
making top personnel decisions at the ministry level-a matter of
fundamental concern to leaders in the Council of Ministers.)
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Finally, doubts may be entertained about the
quality of advice Dolgikh may have been getting on
energy policy from key subordinates in the Heavy
Industry Department."
Presidium of the Council of Ministers. The scene of
greatest operational activity in energy production
decisionmaking appears to be the Presidium of the
Council of Ministers, the "cabinet" of the Soviet
governmental apparatus. The Presidium consists of the
chairman, the first deputy, and deputy chairmen,
and-it seems-all other members of the Council of
Ministers at large who enjoy full membership in the
Central Committee of the CPSU. Within the Presid-
ium there is a relatively stable division of labor,
although roles overlap and depend to some extent
on the play of personal connections and ambi-
tions.
Kosygin's Role. Kosygin has been the top Soviet leader
most deeply involved in energy production matters. He
has dealt with energy issues frequently since at least
the late 1950s and is without question the best-
informed Politburo member on the subject. Within the
Presidium of the Council of Ministers, Kosygin has
taken the lead in pressing the search for long-term
solutions to the Soviet energy problem. He has made
repeated investigatory trips to energy-producing re-
gions and has convened meetings in Moscow to discuss
energy affairs. He supervises the deputy chairmen
responsible for day-to-day control of energy produc-
tion, but has the authority to intervene directly and
issue orders to production ministries and Gosplan. It is
also within his power to approve recommendations of
the Energy Commission for direct implementation. At
various times Kosygin has adjudicated interde-
partment conflicts over energy production. He prob-
ably has a dominant voice in deciding which energy
proposals will be placed on the agenda of Presidium
" On paper, at least, the credentials of these officials as energy
advisers are not overly impressive. The deputy head who attended
the January 1977 meeting of the Oil Ministry Collegium, Vladimir
Arkhipov, had only recently been promoted from the backwater post
of chairman of the Coal Workers' Union. His fellow deputy head,
Ivan Yastrebov, who represented the Department on the same
occasion in 1978, lacks any professional background in energy
whatever. He is a prototypical party worker who has been employed
in the party bureaucracy for over 30 years. His only qualification
would appear to be a longstanding association with the Department's
first deputy chief, Sergey Baskakov, who also is short on training or
meetings, and he firmly presides over these meetings
and sums up the results. He has special responsibilities
in the foreign field, where he is probably the Polit-
buro's top surpervisor of energy-related trade negotia-
tions. The combined weight of these various roles
probably enables Kosygin to dominate the official
interactions on energy matters of the Presidium with
the Central Committee Secretariat and Politburo and
to prevent policy recommendations that he opposes
going forward from the Presidium.
The Deputy Chairmen. In one way or another most of
the deputy chairmen of the Council of Ministers deal
with energy matters, but some are more directly
involved with production than others. It appears that
First Deputy Chairman Nikolay Tikhonov, for exam-
ple, has dealt with power plant affairs and aspects of
the metallurgical industry related to energy, and his
jurisdiction may expand as a result of his promotion to
candidate member of the Politburo in November 1978.
Deputy Chairman Ignatii Novikov, like Tikhonov an
old client of Brezhnev from Dnepropetrovsk, has broad
supervisory responsibilities in the construction of
energy-related production facilities and infrastructure.
Deputy Chairman Vladimir Kirillin, chairman of the
State Committee for Science and Technology, is a key
figure in Soviet energy research and development
(R&D). And Deputy Chairman Baybakov is a central
actor in his capacity as chairman of Gosplan (de-
scribed below). But the Politburo-presumably with
Kosygin's concurrence-has assigned basic responsi-
bilities for energy production to two other deputy
chairmen- Vladimir Novikov and Dymshits.
There appears to be a stable, two-tiered structure of
authority going back at least to the 1960s in which
responsibility for overseeing the entire Soviet energy
sector (fossil fuel extraction and electric power genera-
tion) has been assigned to one deputy chairman,
Vladimir Novikov, while specific responsibility for
supervision of oil, gas, and coal production has been
assigned to a "deputy chairman for fuel-energy af-
fairs"-M. T. Efremov until 1972, and then Dymshits.
In this overlapping arrangement, Novikov has clearly
been the senior figure, although formally he does not
outrank Dymshits and both report to Kosygin.
Novikov, a military production specialist and longtime
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associate of Defense Minister Dmitri Ustinov, has been
one of the Soviet Union's top foreign economic
relations administrators and was briefly chairman of
Gosplan.
Both Novikov and Dymshits have a small secretariat
and several assistants, but no separate research or
policy planning capability. For these functions they
rely upon the Referentura of the Presidium of the
Council of Ministers, the production ministries and
their institutes, Gosplan, and any outside sources
(Academy of Sciences or other) they wish to utilize.
Both can issue orders to ministers and can bring
proposals to Kosygin or meetings of the Presidium.
They are probably the normal channel for communica-
tion between the energy-producing ministries and the
chairman. One of them-it is unclear which-chairs
the Energy Commission of the Presidium. The basic
tasks that they are called upon to perform are policy
planning, coordination of energy production with other
sectors of the economy, adjudication of conflicts
among energy-producing branches, supervision of im-
plementation of energy production plans, and promo-
tion of Soviet international energy policy objectives.
While Dymshits' predecessor, the former party official
Efremov, participated in policy debates, it appears that
Dymshits has tended to avoid policy stands and to stick
to administration. His circumspection may be ex-
plained partly by his vulnerability as the most promi-
nent Jewish leader in the Soviet hierarchy and partly
by the fact that until 1976 he held the taxing post of
chairman of the State Committee for Supply, where, in
effect, he was the chief "wholesaler" for the entire
Soviet economy." Like Dymshits, Novikov has been
burdened with a number of other tasks that must have
permitted him to devote no more than a small fraction
of his time to energy affairs."
'? As a deputy chairman it is quite possible that he may still retain
some supervisory responsibilities in the supply area and may also
15 Novikov has special responsibility for the Soviet machine-building
sector, and has also been chairman of the Presidium's Commission
for Foreign Economic Questions. The range of his concerns apart
from energy is suggested by the obituaries he has signed of officials
in the fields of construction, foreign trade, light industry, the
automobile industry, rocket and space technology, bankin finance,
and state statistics.
The Energy Commission. The Energy Commission is
one of a number of permanent functional commissions
attached to the Presidium of the Council of Ministers.16
Its membership is said to include the two deputy
chairmen responsible for energy matters, the branch
ministers for energy production (Oil, Gas, Coal,
Construction of Petroleum and Gas Industry Enter-
prises, Power and Electrification), some of their
deputies, the chairman of Gosplan (Baybakov) and his
deputy for energy affairs (Arkadiy Lalayants), the
Minister of Finance, and at least one outside expert-
Academician Mikhail Styrikovich. There may well be
other members.
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Whether Dymshits succeeded Efremov as chairman of
the Commission when he took over the latter's duties as
deputy chairman for fuel-energy affairs on an acting
basis in 1972 is unknown. The Commission has no staff
of its own but depends on the Council of Ministers'
Administration of Affairs for logistic support. The
Commission, which is said to meet weekly, discusses
the production targets generated by Gosplan and may
give them its stamp of approval. In the area of policy it
discusses longer term energy development schemes and
assigns project work to the relevant ministries and
institutes. At the same time it provides a forum for the
preliminary discussion of energy policy proposals and
makes general recommendations to the full Presidium
of the Council of Ministers. It is likely that the Energy
Commission provides an arena for intensive jockeying
for resources among the energy production ministries
and for negotiation between the ministries and
Gosplan. Decisions that it takes probably tend to
accommodate the vested interests of all the participat-
ing ministries, and may well be difficult for outside
bodies subsequently to challenge.
The Presidium. The Presidium of the Council of
Ministers reportedly meets every other Wednesday to
discuss, amend, approve, or reject draft resolutions
that have been prepared elsewhere. Its meetings are
attended by members, officials from the Referentura,
16 The most important, and almost certainly the most organization-
ally developed commission, is the Military-Industrial Commission.
Other commissions are known to exist for foreign economic
questions, CEMA affairs, supply, major industrial construction, and
agriculture. There is also a Presidium Commission for Operational
Questions, which, Kosygin stated in July 1978, "is called upon to
examine and solve current questions of economic building and to
implements stematic control over fulfillment of the state plan and
budget."
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 by Kosygin, without formal voting."
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and officials or specialists called to testify on individual
proposals. Kosygin chairs the meetings, and decisions
appear to be taken on a consensual basis, as registered
Although the draft resolutions are the product of
extensive coordination and negotiation among in- .
terested organizations, including Central Committee
departments if the matters dealt with are important,
the discussion of them at Presidium meetings is not
necessarily pro forma. At the Presidium meeting,
aspects of a problem may be discussed that have not
been raised before, or at least not raised in Kosygin's
presence. Dissenting opinions can be and are ex-
pressed. Claims for additional resources can be regis-
tered where decisions lay additional burdens on
organizations. And, finally, confirmation of proposals
provides an authoritative decision that must then be
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Gosplan. A critical function in energy production
decisionmaking is performed by Gosplan and its
chairman, Baybakov. In Gosplan the focal points of
activity related to energy production are the chairman
himself, the deputy chairman for energy affairs
(Lalayants), the branch departments (Coal,.Geology
and Mineral Resources, Petroleum and Gas Industry,
Power and Electrification, Transport), and the Colle-
gium.'$
and deputy chairmen, some department heads, officials from
Gosplan's own consultative and research bodies, and chairmen of
republic planning commissions. It is dominated by Baybakov and
provides a forum for policy review and the discussion of innovations
18 Within Gosplan, Deputy Chairman Lalayants is responsible for
energy, transportation, and the chemical industry. He supervises the
Gosplan departments in these fields and deals with the appropriate
branch ministers. He has a small staff of 5 to 10 people, but relies for
information primarily on the departments under his jurisdiction and
the State Experts' Commission. The role of the departments appears
to be mostly technical: drafting plans, arranging changes in plans
midstream, and monitoring plan fulfillment. But some department
chiefs, such as the current head of the Petroleum and Gas Industry
Department, Vladimir Filanoviskiy, seem to play a more active role
in policy formation. The Gosplan Collegium consists of the chairman
Baybakov's role has been central to the performance of
Gosplan. His power stems from both the office of
chairman and his own personal prestige. He is a deputy
chairman of the Council of Ministers and-like the
Minister of Finance-an ex officio member of all the
Presidium commissions, including the Energy Com-
mission. He has direct access to all the top Soviet
leaders. It is within his competence to initiate studies
and consider analyses of the entire range of energy
questions, acting either through Gosplan or jointly
with branch ministries and the Academy of Sciences-
and he has exercised this authority. As the chief Soviet
planning official, he presides over the preparation of
plans for the energy sector and is strategically situated
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to frame energy options that are set before the
Presidium of the Council of Ministers and the Polit-
buro itself. His considerable personal influence derives
from the good relations he has had with leading Soviet
politicians and his extensive network of clients within
and outside Gosplan, as well as from the respect he
enjoys as an informed expert. He has spent most of his
career in the oil industry and is probably regarded in
leadership circles as one of the most authoritative
voices on oil-issues, with which he has dealt most of his
career.
Influential Advisers
Information, broadly defined, is especially critical in
the energy field. Top policymakers are so busy that
they may well not even have positions on energy policy
issues; and they are not likely to have digested the
technical knowledge necessary to evaluate the merits
of various positions. The experts who possess or control
information in the energy sphere can, therefore, exert
considerable influence on policy.
At the national level a complex information-generating
apparatus complements the structure of operational
command. Its main components are the Referentura of
the Council of Ministers; the State Experts' Commis-
sion, Council for the Study of Production Forces, and
Institute-of Complex Fuel-Energy Problems of
Gosplan; the production branch ministries and their
institutes and advisory councils; the State Committee
for.Science and Technology; and the Academy of
Sciences.
The Referentura. The Referentura of the Council of
Ministers is the' consultative-advisory staff that serves
the chairman and deputy chairmen of the Council of
Ministers. It consists of approximately 300 persons,
about evenly divided between clerical workers and
high-level, full-time advisers known as referents. The
referents, in turn, recruit outside consultants who are
paid on a per-job basis to conduct research, write
memorandums, and draft various documents.19 C
" Among the referents there are hierarchical gradations based on
whether a referent is directly subordinate to Kosygin or simply
subordinate to one of the deputy chairmen, whether the referent is
responsible for an entire sector of the economy or just for a particular
ministry, and whether the referent is head of a department within the
Ivan Popyrin, head of the Department for Problems of
Fuel Energy, Foreign Trade Ties and Domestic Fuel-
Energy Supply, is the key referent for energy questions
in the Referentura.20 He has worked for both Kosygin 25X1
and Novikov and has dealt with Dymshits as well.
Popyrin is in almost
daily contact with Kosygin. His job is to consider the
basic policy choices in energy affairs, investigate 25
solutions to production, transportation and trade
problems, and advise Kosygin and Novikov accord-
ingly. While he, like other referents, is not vested with
the authority to issue commands, he is feared by
economic managers because of his independence and
access to the top leadership in the Council of Ministers.
He distrusts information supplied by the ministries and
their institutes and prefers to rely on consultants he
himself has chosen, whose memorandums he forwards
directly to Koysgin.21
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State Experts' Commission. In Gosplan, a body
analogous to the Referentura exists in the form of the
State Experts' Commission. This commission also
employs part-time consultants, who in fact carry out
most of its analytic work. The Commission has no true
authority, but is responsible for advising Baybakov on
any topic in which he is interested. The Commission
official primarily concerned with energy matters is its
deputy chairman, Yuriy Bokserman, a castoff former
Deputy Minister of Gas, who owes his prominent job 25
and "Kremlin ration" exclusively to Baybakov's pro-
tection.
ministries.
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the' Council of Ministers responsible for science policy,
was head of the Department for Science, Schools, and
Higher Education in the Central Committee from
1955 to 1962 and then a vice president of the Academy
of Sciences until 1965. His career-and contacts-
bridges the Academy of Sciences - Communist Party -
government domains. His field of professional special-
ization is power engineering, and at his initiative the
Institute of High Temperatures of the Academy of
Sciences, which is responsible, among other things, for
the Soviet program in magnetohydrodynamic (MHD)
direct conversion of thermal into electrical energy, was
established in 1963.22
The main task of the Committee is to elaborate plans
for Soviet scientific and technological development,
which are then confirmed by the Central Committee
apparatus and the Presidium of the Council of
Ministers. In generating these plans the Committee
works closely with the Academy of Sciences, the
ministries, and Gosplan. Its prime source of influence
lies in its authority-acting in concert with Gosplan
and the Ministry of Finance-to pass judgment on the
R&D proposals of the Academy of Sciences and
branch institutes and to allocate the Soviet science
budget. The Committee also closely monitors progress
on a limited number of high-priority projects, some of
them in the energy field. It has numerous subcommit-
tees and councils, including the Council on the
Problem of Power and Electrification and the Subcom-
mittee on Renewable Sources of Energy, which are
Nikolay Nekrasov
Council for the Study of Productive Forces (Gosplan
For information, Baybakov has also drawn on the
Council for the Study of Productive Forces (SOPS),
headed by Nikolay Nekrasov, and the recently estab-
lished Institute of Complex Fuel-Energy Problems,
headed by Sergey Yatrov-both of which fall under
Gosplan control. SOPS specializes in the analysis of
broad regional planning problems, and Nekrasov has
concentrated much of his attention on Siberian devel-
opment.
At a lower level in the government hierarchy each
ministry has its own network of research and design
institutes and advisory councils. While a competition
of ideas can and does take place in these forums, their
pronouncements to the external world-especially
when articulated in Moscow-are closely vetted so as
to reflect ministerial interests.
State Committee for Science and Technology. The
State Committee for Science and Technology has the
potential for great influence over energy policy, which
in practice it may not have fully realized. Its chairman,
Vladimir Kirillin, who is also the deputy chairman of
important mechanisms of R&D coordination.
27 One of his three first deputy chairmen, Dmitriy Zhimerin, was
Minister of Electric Power Stations under Stalin, later served as a
deputy chairman of the RSFSR and USSR Gosplans, and from 1964
to 1971 directed the leading institute of the Ministry of Power and
Electrification-the Krzhizhanovskiy Power Engineering Institute
in Moscow. He has been active professionally in the fields of MHD
development and research on superconductive electric powerlines.
Another of his deputies, Genadiy Aleksenko, has also specialized in
power generation and transmission as well as communications
equipment and transportation. He is responsible for mineral
resources, power and electrical engineering, and transportation. Still
another deputy, Kosygin's son-in-law, Dzherman Gvishiani, is
responsible for the international activities of the Committee and is
also director of the Committee's Institute of Systems Research in
Moscow, which conducts some energy-related research. Gvishiani
has been a prominent exponent of Soviet acquisition of Western
energy technology and has been active in energy trade and scientific
exchange negotiations.
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Key Acadamy of Sciences
Energy Advisers
Anatoliy Aleksandrov
President of the USSR Academy of Sciences
Nikolay Mel'nikov Lev Melent'ev
Chairman, Commission for the Study Chairman, Scientific Council
of Production Forces and Natural Resources for Complex Problems of Power
Mikhail Styrikovich
Chairman, Division of Physico- Technical
Problems of Power
Andrey Trofimuk
First Deputy Chairman, Siberian Division
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Academy of Sciences. Within the Academy of Sci-
ences, responsibility for energy studies is spread among
a number of individuals and groups. In the Presidium
of the Academy, the President, Anatoliy Aleksandrov
(who is also the director of the Kurchatov Institute of
Atomic Energy), chairs a permanent commission that
supervises the elaboration of a long-term program for
the USSR's fuel-energy complex. He is himself a
forceful advocate of nuclear power, although evidently
not of fusion energy. The new first vice president for
science and technology, Yevgeny Velikhov, is also
deputy director of the Kurchatov Institute. Aleksandr
Sidorenko, the vice president for earth sciences, was
Minister of Geology until 1975. And Vice President
Guriy Marchuk, chief of the Siberian Division of the
Academy, has overall responsibility for a considerable
amount of Siberian energy-oriented research. The
remaining membership of the Presidium includes a
number of research administrators or scientists with
energy-related interests: Nikolay Inozemtsev (foreign
technology acquisition); Petr Kapitsa (nuclear power);
Nikolay Mel'nikov (natural resources planning); Boris
Paton (welding technology); Mikhail Styrikovich
(MHD and general energy studies ; and Andre
Trofimuk (Siberian geology).
Serious research that bears directly upon energy
production policymaking is concentrated in several
centers of the Academy. The most important of these is
the Division of Physico-Technical Problems of Power,
headed by Academician-Secretary Styrikovich.
Styrikovich, who also directs a laboratory at the
Division's Institute of High Temperatures and until
1976 was chairman of the Division's Scientific Council
on Complex Problems of Power, is one of a handful of
top-level Academy spokesmen on energy policy issues.
The Division has broad responsibilities for managing
energy research, which it coordinates with other
divisions of the Academy and with the State Commit-
tee for Science and Technology. 23 Its Scientific Coun-
cil for Complex Problems of Power was organized in
1965 for the purpose of "determining the basic
scientific directions and most effective proportions and
paths of development of electrification, power engi-
neering, and the fuel industry as a single branch of
material production, and also of coordinating theoreti-
cal research in these areas."
The chairmanship of the Council was shifted in 1976
from Styrikovich to the former deputy chairman, Lev
Melent'ev. Melent'ev, a specialist in thermal power
stations, is deputy academic secretary of the Division
of Physico-Technical Problems of Power and until
1974 was concurrently director of the Siberian Power
Institute. Since then he has spent all his time in
Moscow, where he has headed a department concerned
with energy-related economic studies in the Institute of
High Temperatures and has also served as
Styrikovich's deputy in the Division. Professionally, he
has collaborated in recent years with Kirillin,
Styrikovich, and A. Ye. Sheyndlin (Director of the
Institute of High Temperatures) on MHD research.
The second main center of energy-related studies in the
Academy of Sciences is the Commission for the Study
of Production Forces and Natural Resources, chaired
by Nikolay Mel'nikov, which is organized under the
Academy's Presidium. Mel'nikov is a specialist in
open-pit coal mining with extensive leadership expe-
rience in the coal industry. Recently he was appointed
director of the Institute of Complex Exploitation of
Mineral Resources in the Division of Geology, Geo-
physics, and Geochemistry. Over the years he appears
to have forged strong links with Gosplan, where he has
served in a top-level advisory capacity. The Commis-
sion has focused its attention on long-term forecasting
23 According to a recent statement by Styrikovich, institutes and
scientists within the Division are working on the long-term fuel-
energy program under the guidance of Aleksandrov's commission.
They are studying energy applications of electrophysics and
electrotechnology; long-distance energy transmission; determination
of the best size of equipment for fossil and nuclear as well as
hydroaccumulating power stations; optimization of the country's
fuel-energy balance for the next 15 years; optimization of the
development strategy and use of nuclear power, including fast
breeder reactors; energy applications of superconductivity; creation
of super-powerful turbogenerators; MHD generation of power; heat-
exchange devices; and a number of other subjects. The Division is
also heavily involved in foreign scientific exchanges. Vestnik AN
SSSR 1977, No. 7, pp. 81-84.) F_ I
Confidential 16
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of the use of natural resources, including energy
production and consumption, with special emphasis on
the formation of regional production complexes. With
the Commission as his organizational base, Mel'nikov
has emerged as perhaps the most prominent energy
balance expert in the Academy, or at least one of the
top three along with Styrikovich and Melent'ev. =
Other centers of energy study in the Academy include
the Permanent Commission for Scientific Problems of
Development of Transport, the Division of Economics,
and the Siberian Division in Novosibirsk. In the
Siberian Division the key leaders have been Andrey
Trofimuk, the first deputy chairman of the Presidium
of the Division and director of its Institute of Geology
and Geophysics, and Abel Aganbegyan, Director of
the Institute of Economics and Organization of Indus-
trial Production. Trofimuk has spearheaded Siberian
oil and gas development, and Aganbegyan has encour-
aged mathematical modeling of the Soviet energy
balance as well as regional economic analysis of West
Siberia and other Siberian fuel-producing areas.
The capacity of the Soviet leadership to deal with the
energy problem is significantly constrained by the
environment and institutions outlined above. Certain
features of the process of decisionmaking that emerge
in this context are important:
? There is no single center of control over energy
production policy. Pieces of control are lodged at
various places in the Presidium of the Council of
Ministers, the ministries, the Secretariat, and the
Politburo. No top official devotes all his time to energy
questions. While Brezhnev, Dolgikh, and the Central
Committee apparatus can and have intervened in
energy production policy, it does not appear that the
party bureaucracy exercises tight, effective control
over this area, nor does it seem that Kosygin has it all
his own way either.
personal contacts and exchanges of opinion among top
leaders. Formal interorganizational coordination pro-
cesses, which magnify the influence of "veto" groups,
also put a premium on negotiation." And negotiation is
built into the system of "collective" sounding boards
that exist at all levels of the decisionmaking process:
the insitute collegiums, regional party bureaus, minis- 25X1
try collegiums, Gosplan Collegium, Energy Commis-
sion, Presidium of the Council of Ministers, and the
Politburo itself. The system manifestly evokes lobby-
ing, coalition formation, and the co-option of potential
opponents.
? Trends in "opinion," partly orchestrated from above,
but partly crystallizing from below in a Soviet-style
"bandwagon"fashion, can influence decisionmaking-
especially in a policy area in which nobody is fully in
charge and the issues at stake involve a host of
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The total effect of the environment, the motivation of
decisionmakers, and the process by which decisions are 25X1
made is to produce outcomes that are more the result
of the play of bureaucratic and personal interests than
of rational long-term calculation. The system tends to
generate compromise decisions and to respond slowly
to new situations. On the whole, incrementalism is the
rule, and is expressed in the energy field-as else-
where-through planning "from the achieved level."
Campaign-type changes in the line of march are
nevertheless possible and have repeatedly occurred.
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III. Controversy Over Energy Policy: 1970-77
How to cope with the emerging energy problem has
been seriously debated by Soviet specialists and
economic officials since the early 1970s. A variety of
? Policy ordinarily emerges through a labyrinth of
bureaucratic negotiation, although "breakthroughs"
can occur. Negotiation takes place by means of
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strategies have been advocated (see the appendix for
details), but because of the inherent complexities and
uncertainties of energy issues, competing claims on
resources, long R&D leadtimes, ineffectiveness of
economic planning and management, and absence of
cohesive political leadership in this sphere, no single
strategy has dominated the field. Consequently, there
has been substantial flux and vacillation in ergy
policy.
The evidence indicates that, in fact, energy production
policy decisions have not been dictated by some
agreed-upon, comprehensive, and stable long-term
program. There have been general notions about
desired trends in the fuel-energy balance that have
probably commanded fairly broad acceptance in the
abstract, and there have been various sectoral energy
R&D programs. But the sum of these has not been a
"master plan." In recent years Soviet authorities
themselves have complained, among other things,
about:
? The absence of a long-term program for oil and gas
production in Tyumen Oblast.
? Lack of a long-term program for further exploitation
of the older oil regions.
? No program for offshore oil development.
? The absence of a long-term (10 to 15 years) plan for
development of fuel-energy production.
? Avoidance of a basic decision on the regional pattern
of refinery location.
? Continued delay in announcing the promised 15-year
plan for the economy as a whole.
? Uncertain plans for gas pipeline construction in
Tyumen.
? Neglect of forward planning in energy machine
building.
? Inadequate treatment of economic criteria, capital
investment effectiveness, and regional integration in
energy planning.
? Failure to establish a center for coordinating the
administration of the fuel-energy complex.
? Lack of territorial coordination of implementation of
plans in Tyumen, Komi, Kansk-Achinsk, and other
developing energy regions.
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Because of the short- to medium-term inertia of the
energy balance, it has been of fundamental importance
to the Soviets to adopt and stick to an integrated long-
term
energy production program. Only the direction
provided by such a program can bring about the
cumulation of incremental shifts in the energy balance
that policy dictates as optimum. To a considerable
degree, the inability to gear planning to this kind of a
program arises from a failure to resolve a continuing
argument over energy strategy. 25X1
The debate over production strategy has turned on the
priorities that should be established among energy
resources, the regions that ought to be developed, and
the technologies that ought to be employed. The
central question has been: how best, and in what
proportions, should the Soviet Union's oil, gas,
coal, hydro-, and nuclear-power resources be devel-
oped?
The key responses given to this question since the late
1960s can be labeled the Hydrocarbon, Big Gas, Big
Coal, and Combined Resources strategies. Naturally,
they are not flagged this clearly in Soviet sources, and
there is considerable overlap between the Hydrocarbon
and Big Gas solutions, on the one hand, and the Big
Coal and Combined Resources solutions, on the other.
(In the appendix the latter two are treated together.)
Nor are the approaches necessarily associated with a
fixed group of proponents, because some officials have
supported several approaches simultaneously or have
changed their positions over the course of time, and
top-level leaders have generally hedged their policy
commitments. The main features of these approaches
are shown on the foldout chart at the end of this paper.
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Over the past decade each of these strategies has been
more or less constantly urged by at least some
authorities, but has attracted more support and had
more of an impact on the "party line" in certain
periods than in others. The Hydrocarbon strategy
completely dominated the field until the late 1960s,
remained the official line until 1975, and then made a
comeback in December 1977; Big Coal was urged by
some in the 1969-70 period; Big Gas was seriously
considered in 1970-75; and Combined Resources was
in effect accepted as the new line in 1976-77.
Hydrocarbons
The starting point in a consideration of contemporary
Soviet energy production policy is the adoption as the
official line in the 1950s of what we have dubbed the
Hydrocarbon strategy. At the 21st Party Congress in
1959 the party leadership placed its stamp of approval
on a major shift in the fuel balance away from coal and
toward oil and gas, which were held to be more
"progressive" because of their lower cost of extraction,
ease of transportation, and use characteristics. In
adopting this strategy the Soviets were also emulating
the West, where oil and gas had displaced coal during
the postwar period. Implementation of this decision
has determined the dynamics of Soviet energy produc-
tion up to the present day (see table 1).
After Khrushchev's ouster, priority development of oil
and gas was reaffirmed as the party line at the 23rd
Party Congress in 1966 and was again endorsed at the
24th Party Congress in 1971. At the latter both
Kosygin and Brezhnev declared themselves in favor of
increasing the share of oil and gas in the fuel balance,
and the Ninth Five-Year Plan (1971-75) projected a
rise of oil and gas from a combined total of 60.4
percent in 1970 to 67.4 percent in 1975. This strategy
remained the official position until the end of 1975,
when a new line was introduced in a Politburo-
approved set of directives for compiling the 10th Five-
Year Plan (1976-80). Nevertheless, the strategy was
seriously questioned both before and after 1970. F7
Gas 7
Oil'
Coal
1955
2.4
21.1
64.8
1956
3.0
23.3
63.2
1957
4.0
24.5
61.2
1958
5.5
26.3
58.8
1959
6.4
28.1
56.1
1960
7.9
30.5
53.9
1961
9.7
32.4
50.5
1962
10.9
34.2
48.8
1963
12.4
34.8
45.9
1964
13.9
35.1
44.2
1965
15.5
35.8
42.7
1966
16.5
36.7
40.7
1967
17.2
37.8
39.4
1968
17.9
39.2
38.0
1969
18.3
39.9
37.3
1970
19.1
41.1
35.4
1971
19.5
41.8
34.6
1972
19.5
42.3
34.0
1973
19.9
43.2
33.0
1974
20.8
43.8
32.1
1975
21.8
44.1
30.8
1976
23.1
45.1
29.0
1977
23.7
45.2
28.1
1978
24.5
45.4
27.0
'Sources: Narodnoye khozyaystvo SSSR, various issues.
z Natural and associated.
Including gas condensate.
CIA estimate.
Coal
In 1969-70 a group that included Academicians
Mel'nikov and Styrikovich and Minister of Coal
Bratchenko came to the conclusion that the long-term
prospects for oil and gas were inadequate to meet
future energy needs. This group is said to have
submitted a report to the Politburo during the drafting
of the Ninth Five-Year Plan which in effect argued the
case for Big Coal: Kansk-Achinsk should be developed,
and coal substituted for oil and gas. The Politburo
reportedly rejected this proposal on the grounds of
excessive cost and decreed that Kansk-Achinsk devel-
opment should be put off 20 to 25 years unless a
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Boris Bratchenko
Minister of Coal
Boris Sherbina
Minister of Construction of
Petroleum and Gas Industry Enterprises
breakthrough in transportation occurred in the mean-
time, thus ehding any immediate prospects for Big
Coal.
Gas
By the second half of the 1960s the magnitude of
natural gas reserves in northern Tyumen had become
apparent, and arguments in favor of a Big Gas strategy
began to be voiced. One of the earliest proponents of
rapid development of these deposits was the then first
secretary of the Tyumen oblast party committee
(obkom) and present Minister of Construction of
Petroleum and Gas Industry Enterprises, Boris
Shcherbina, who has steadfastly adhered to this
position up to the present. Even in 1965 Shcherbina
argued that a Big Gas system based on Tyumen gas
should be given priority over Central Asian gas
development. Since that time he has repeatedly in-
sisted that natural gas provides a way of introducing a
fundamental shift in the Soviet energy balance. Along
with Bogomyakov, his successor as Tyumen obkom
first secretary, Shcherbina has resolutely defended the
use of natural gas as a boiler fuel. Over the years, both
have also lobbied for the construction of a set of giant
gas-burning thermal stations in Tyumen Oblast that
would transmit power west over high-voltage lines. Jul
In the second half of the 1960s there were signs the
Soviet leadership was indeed considering the Big Gas
option. In 1970, construction began on the "Northern
Lights" pipeline from Medvezh'ye in northern
Tyumen to the Moscow region. However, gas plans
began quickly to be scaled down, and it became clear in
1,971 that the leadership had backed off from targeting
a sharp increase in gas production in the Ninth Five-
Year Plan (1971-75). The question of a major surge in
gas production was nevertheless still under active
consideration. In 1972 the Ministry of Gas and other
organizations were ordered to design a so-called Big
System that would "solve" the Soviet energy problem
to the year 2000 by delivering 300 billion cubic meters
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of gas a year to the Urals and European USSR through
10 large-diameter trunklines. The cost estimates of this
project (reportedly 22 billion rubles and 20 million tons
of steel) led to its rapid abandonment.
At this juncture, the search for a less expensive means
of exploiting Tyumen gas turned to both foreign
assistance and technological innovations aimed at
reducing the cost of pipeline transport. It appears that
between 1972 and 1974 the Soviet leadership seriously
hoped that the proposed North Star and Yakutiya
deals involving Western participation would provide a
means of acquiring the financial resources, large-
diameter pipe, and compressors needed to lay the
foundation of a Big Gas strategy. Simultaneously,
attention began to be focused on a proposal to
transport Tyumen natural a. hydrate form throu h
a capsule pipeline system
Both ideas were vigorously opposed by Minister of Gas
Orudzhev. Orudzhev has persistently tried to slow
down gas development in Tyumen in order to moderate
the attendant production and delivery problems, which
fall upon his own shoulders. He has rejected the Big
Gas strategy on the grounds that gas, as a valuable
nonrenewable resource, should not be burned as a
boiler fuel but should increasingly be used solely as a
feedstock for the chemical and petrochemical indus-
tries. His opposition to the North Star deal was also
couched in patriotic terms of defense of the national
patrimony-an argument considered specious by
knowledgeable Soviet observers, but one which did
have some political resonance. Orudzhev came down
strongly in the mid-1970s on the side of developing the
Orenburg gasfield, which, although far smaller than
the northern Tyumen deposits, involved fewer
difficulties because of its favorable location and could
be rationalized as a response to the objective require-
ments of supplying Eastern Europe with energy.
Passage of the Stevenson Amendment by the US
Congress in 1974 effectively ended Soviet hopes of
implementing a Bi Gas strategy based upon foreign
credits.
Initially, the prospect of achieving a breakthrough in
gas transportation by means of technological innova-
tion had been looked upon favorably both in Gosplan
and the Academy of Sciences. Baybakov himself in the
Sabit Orudzhev
Minister of Gas
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1973-75 period strongly supported R&D work on the
capsule transmission of gas and on a new multiwalled
gas pipe. As the time drew near to make decisions on
the 10th Five-Year Plan (1976-80), however, the
enthusiasm for gas began to wane-especially on the
part of key Academy of Sciences energy advisers like
Styrikovich, Mel'nikov and Melent'ev. Baybakov con-
tinued to support the idea of accelerated gas produc-
tion, but insisted that implementation of such a
strategy would depend upon achievement of a si nifi-
cant reduction in the cost of gas transport.
In the fall of 1975 the Big Gas approach was still
sufficiently alive, according to one report, to be
reflected in a preliminary version of the section on gas
in the draft document that set out the leadership's
economic strategy for the next five-year plan: Basic
Directions of Development of the Economy of the
USSR for the Years 1976-1980. The preliminary draft
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is said to have contained a long passage on Urengoy
and development of a capsule system that would
transport Urengoy gas on a massive scale to the
European USSR. When the draft was published in
December 1975, however, this entire passage was
omitted. Motivated partly by fear of relying on an
untested and risky new technology, partly by high
investment costs in gas transport and demands on the
metallurgical industry, and partly-perhaps-by per-
sonal factors (see the appendix), the leadership once
again retreated from a big commitment to gas.
Failure to endorse rapid Urengoy development explic-
itly in the five-year plan for 1976-80 appears to have
left the whole issue hanging in 1976 and 1977. There
was clearly an intention to begin production and build
some pipelines from Urengoy during the five-year
period, but the evidence suggests that uncertainty over
the pipeline routes and pace of development existed up
to the second half of 1977.
This inability to score a breakthrough in gas may
represent a critical lost opportunity for the Soviets. It is
possible that the failure to develop the gas industry
more rapidly in the 1970s will substantially constrain
the leadership's capacity to deal effectively with the
looming energy crunch of the early 1980s-that is, to
effect a meaningful substitution of gas for oil in the
domestic economy and to cope with the tradeoff
between East European energy needs and Soviet
requirements for hard currency.25 In the longer run,
failure to move more rapidly on gas in the 1970s may
have damaged Soviet chances of successfully bridging
the period until Kansk-Achinsk coal and nuclear
power will-it is hoped-reduce dependence on hydro-
carbons.
Hydrocarbons, Coal, and Nuclear Power
As we have seen, by the late 1960s there was already a
conviction in some circles that the conventional strat-
egy of increasing the share of hydrocarbons in the fuel
balance was no longer viable, and an unsuccessful
attempt was made to include major development of the
Kansk-Achinsk coal basin in the Ninth Five-Year Plan
" The relative growth of gas production in the 1970s was, of course,
quite respectable. Given the cost factors inhibiting a still faster
expansion, many Soviet authorities were probably quite satisfied
with the rate achieved. See USSR: Development o the Gas
Industry, ER 78-10393, July 1978.1- 1
(1971-75). The Politburo's rejection of this proposal in
1970 only temporarily deflected interest in shifting the
fuel balance away from hydrocarbons.
There was no question in the minds of critics of the
Hydrocarbon strategy that Kansk-Achinsk coal was a
critical factor. Differences of opinion did exist, how-
ever, over its precise role. It appears that only a
minority of coal boosters, most visibly represented by
the scientist Chukhanov, believed that there was no
alternative to an exclusive Big Coal approach and
maximum immediate reliance on Kansk-Achinsk. The
majority thought that there was less possibility of
substituting coal for hydrocarbons in the short run
than did Chukhanov, but much greater scope for
nuclear power development in the longer term. From
this perspective, development of Kansk-Achinsk coal
represented a current strategic goal aimed at meeting
midterm energy demand, within the context of a
phased integration over time of hydrocarbons, coal,
and nuclear energy resources. While some of the
proponents of this Combined Resources approach had
a vested professional interest in coal development, a
majority had a stake in either nuclear power or nuclear
and coal-based MHD power generation. The latter
group included chairman of the State Committee for
Science and Technology, Kirillin, and Academicians
Styrikovich, Melent'ev, and Sheyndlin-all of whom
were linked with the Institute of High Temperatures,
the peak MHD research organization.
Between 1973 and 1975, intense examination of energy
production policy took place in the Academy of
Sciences, the State Committee for Science and Tech-
nology, and Gosplan, and by 1975 a strong consensus
of opinion had crystallized among top-level energy
advisers that an accelerated development of coal
production, MHD, slow neutron and breeder reactors,
and fusion power was necessary.26 Following heavy
lobbying, this opinion was directly reflected in the
Politburo-approved set of directives for compiling the
10th Five-Year Plan (1976-80). This document pro-
vided the framework for Kosygin's report on the Plan
Z6 At the same time there have reportedly been sharp conflicts within
this community over the share of resources allocated to various
elements (for example, fusion versus fission power) and over the
control of research and development programs. Combined Resources
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to the 25th Party Congress in March 1976 and for the
Plan finally adopted at the October 1976 session of the
Supreme Soviet.
In his report to the party congress, Kosygin prefaced
his remarks on the fuel-energy complex with a
comment that was later to be frequently quoted by
those in favor of an autarkic energy policy. "The Soviet
Union," he said, "is the sole large industrial state in the
world that bases its economic development on its own
fuel-energy resources. This is a serious advantage of
our economy and a quite important precondition of its
steady growth." But in order to retain this advantage,
Kosygin in effect argued, it was necessary to begin
shifting the fuel-energy balance:
In this five-year plan the foundations will be laid
for future growth of our energy potential primar-
ily on the basis of hydroelectricity, atomic fuel
and cheap coal. As regards oil and gas, the growth
of their extraction will to an ever greater degree
be directed to technological needs.
Accordingly, the combined share of nuclear power and
hydroelectricity in the capacity of new electric power
stations would rise from 22 percent in the Ninth Five-
Year Plan to 40 percent in the 10th Five-Year Plan.
Coal would begin to play an increasing role in
supplying the country with fuel and electrical energy:
Already in the 10th Five-Year Plan the use of
Ekibastuz and Kansk-Achinsk coal will be consid-
erably expanded for production of electrical
energy, and a number of large thermal electric
power stations in the Urals and Volga regions will
be converted from fuel oil to coal. For this purpose
further development of the coal industry is
planned, especially opencast extraction of coal in
the Ekibastuz, Kansk-Achinsk, Kuznetsk, and
South Yakutsk basins.
Gas production would increase 50 percent by 1980, but
its use for technological purposes-as opposed to
power production-would double. To meet the "ever-
growing needs" of the European USSR and Urals for
fuel and electrical energy, a big program of nuclear
power station construction in the western part of the
country would be combined with accelerated construc-
tion in the east of large thermal power stations burning
coal mined in Kazahkstan and Siberia, the power from
which would be transmitted to the European USSR
through the Single Electric Power grid. In contrast to
his emphasis on coal and nuclear power, Kosygin had
virtually nothing to say about oil production over the
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The line expressed by Kosygin in March 1976 was
reflected in the official resolution of the party congress,
and in the report that Baybakov delivered upon the
actual adoption of the 10th Five-Year Plan in Octo-
ber.27 Throughout 1977 there were no indications that
the official position had changed. With some shadings
of emphasis it appeared to be accepted as a given in
public statements by such luminaries as Central
Committee Secretary Kirilenko, President of the
Academy of Sciences Aleksandrov, and Academician
Styrikovich.
Nevertheless, implementation of the new line was very
slow. A fundamental problem was how to go about
actually utilizing the enormous potential energy of
Kansk-Achinsk coal.28 There has been general agree-
ment that some of the coal should be burned in mine-
mouth generating plants to supply power for local
needs. Beyond this point, different opinions on the
desirable mode of transmitting Kansk-Achinsk energy
were expressed both before and after adoption of the
10th Five-Year Plan. There have been proposals to
build large mine-mouth generating stations and trans-
mit electric power over superhigh-voltage lines to the
European USSR; to build a special broad gauge coal
railway from Kansk-Achinsk to central Russia; to
build a slurry or capsule pipeline; to build a
superconductive cable; and to build coal liquefaction,
" It should be stressed that the line was that the groundwork would
be laid for a future increase in the share of coal in the fuel-energy
balance, not that the share of coal would increase during the 10th
Five-Year Plan. In other words, the initial objective was simply to
slow do" , and then stabilize the share of oil. Thus the plan in fact
foresaw a decline in the share of coal in the overall energy balance
from 30 percent in 1975 to 26 percent in 1980, with a slight increase
in the share of oil from 43.0 percent to 43.1 percent. The share of
coal in boiler fuel was likewise expected to drop from 32.9 percent to
29.5 percent, and only a slight drop from 18.3 percent to 17.4 percent
was projected in the share of oil. (A. M. Nekrasov and M. G.
Pervukhin [eds.], Energetika SSSR v 1976-1980 godakh [Moscow,
1977], p. 149.)
28 Kansk-Achinsk brown coal has low calorific value, high water and
ash content, and tends to self-ignite when transported over relatively
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gasification, or semicoking facilities, with the product
either being shipped west or used as an enriched fuel
for power generation.
Each of these variants is extremely costly, and most
involve high levels of technological risk and extremely
long R&D gestation periods. Apparently, the most
appealing option has been the construction of a 2,200-
kilovolt DC superhigh-voltage line from Kansk-
Achinsk to the European USSR. However, before this
technological feat can be accomplished, the effective-
ness of a projected Ekibastuz-Center 1,500-kV DC line
will probably have to be studied. The indications are
that a Kansk-Achinsk - Center line will not be in
operation before 1990 at the earliest.
The notion that Kansk-Achinsk development would
make any significant contribution to the Soviet energy
balance before 1980 was evidently discounted almost
immediately after the 10th Five-Year Plan was
adopted-if not before-by such key figures as Minis-
ter of Coal Bratchenko, Minister of Power and
Electrification Neporozhniy, and Baybakov himself.
The de facto strategy that emerged in the first two
years of the current five-year plan was to press ahead
on Ekibastuz coal extraction, to assign priority to
design and construction of the 1,500-kV DC
Ekibastuz-Center transmission line, to develop very
gradually the third extraction site in Kansk-Achinsk
(the Berezovo coalfield), and to look in the medium
run toward a link-up of Kansk-Achinsk with the
Kazakhstan power grid by means of a 1,150-kV
AC line-which would permit a roundabout transfer
of a small amount of Kansk-Achinsk power at least to
the Urals until the Ekibastuz-Center line goes into
operation.
Not surprisingly, discussions of Kansk-Achinsk since
1976 have exhibited considerable ambivalence. The
decision in the 10th Five-Year Plan to go ahead with
Kansk-Achinsk, even though the transportation issue
remained unresolved, has led some authorities to
redefine the central function of Kansk-Achinsk by
emphasizing its role as the hub of a vast energy-
intensive industrial complex to be formed in
Krasnoyarsk Kray. This point of view, which has been
publicly articulated by Mazover and Nekrasov of
Gosplan's SOPS, implies an extremely bullish attitude
toward Siberian industrial development, but by the
same token suggests that Kansk-Achinsk coal will not
solve the critical European USSR fuel deficit in the
foreseeable future. Meanwhile, others-including
some Gosplan officials-continue to emphasize trans-
portation of Kansk-Achinsk energy to the western
regions of the USSR.
In practice, some progress has been achieved in
Ekibastuz during the present five-year plan, and it is
claimed that the technology of 1,500-kV DC
transmission has now been mastered and that actual
contruction of the line is about to begin. Reports from
Kansk-Achinsk, however, indicate that while a few
broad output targets have been set, no comprehensive
development program for the region existed as late as
1977. Despite efforts by the Krasnoyarsk obkom to
generate such a program and to establish some
mechanism for coordinating the activities of the dozens
of agencies involved in developing Kansk-Achinsk, the
familiar pathology of malcoordination at the regional
level has emerged full-blown. Each ministry goes its
own way, guided by its own vested interests, and vital
long-term development needs are simply ignored.
There is no evidence that the leadership in Moscow was
prepared to intervene decisively to change this situa-
tion in the period prior to the December 1977 Plenum
of the Central Committee, when the party line ado ted
only two years before was suddenly revised.
IV. The Present Situation
A reappraisal of Soviet energy production policy
undertaken in the second half of 1977 was conducted
so secretly that most authorities were evidently caught
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off guard by the change in line at the December
Plenum of the Central Committee.29 We do not know
precisely why this shift in the line occurred, but among
the likely reasons are:
? Recognition that the oil reserve situation had become-
quite serious. Despite earlier assertions that oil produc-
tion could be maintained only if giant new oilfields
were discovered, none had been found by 1977. By the
end of 1977 there was no conceivable way of bringing
in a giant field in time for the 11th Five-Year Plan.
Meanwhile, geologists in Tyumen for the second
straight year were failing to fulfill the plan for
increasing reserves, and there were reserve difficulties
elsewhere as well. Anxiety of specialists over oil
reserves in 1977 was already profound, and their
concern probably increased.
? Worsening performance in oil production in
1976-77. In 1976, seven oil regions did not fulfill their
plans, and the Ministry as a whole did not fulfill the
"supplementary targets" that had been laid on it. In
1977 the Oil Ministry failed to fulfill its above-plan
"obligations," and six administrations-including two
in which the Soviets had invested some hope (Perm and
Orenburg)-did not even meet their plans. In Tyumen
the duration of drilling downtime increased twofold
over 1976, the plan for transfer to mechanized
extraction was not fulfilled, the plan for introduction of
new production capacity was fulfilled by only 86
percent, and the plan for nonproduction construction
was also unfulfilled. There was also a sharp drop in
pressure at the Fedorovo field.
29 In late July or early August a delegation consisting of the Ministers
of Oil, Gas, and Construction of Petroleum and Gas Industry
Enterprises, other ministerial and Central Committee officials, and
probably Gosplan Chairman Baybakov made a secret visit to
Tyumen. This was a procedure that had preceded earlier policy
changes related to Tyumen. There were also some significant
personnel shifts in 1976 and 1977. Vladimir Kremnev, a former
Central Committee official responsible for petroleum was appointed
First Deputy Minister of Oil in July 1977, and there appear to have
been three other top-level changes in the Ministry of Oil in 1977, as
well as a number of changes in the leadership of territorial oil
production administrations. Yurii Erv'e, former head of the Tyumen
Geological Administration (Glavtyumengeologiya), was appointed
Deputy Minister of Geology in December 1977. There also seems to
have been a major shakeup in the Gosplan Transport Department
during the course of 1977. In 1976, Vladimir Filanovskii, formerly of
Tyumen, appears to have replaced Pavel Galonskii as head of
? Possible anticipation of a more rapid decline than
projected in oil output in the older oil-producing
regions.30
? Probable nonfulfillment of its 1977 plan by the
Ministry of Construction of Petroleum and Gas
Industry Enterprises.
? Possible anticipation of a more rapid decline than
projected in older gasfields (for example, in Central
Asia).
? A general intensification of energy shortages: power
plant fuel shortages, petroleum shortages, and failure
to fulfill energy conservation measures.
The Central Committee Plenum and the Supreme
Soviet session on the plan and budget for 1978 were
held successively in mid-December 1977. None of the
speeches delivered at the Central Committee plenum
were published, and substantial secrecy still surrounds
the proceedings; the main evidence of what was said is
a Pravda editorial paraphrase of Brezhnev's speech,
published after the conclusion of the Supreme Soviet
meeting.
The general context in which the energy issue was
posed was evidently one of extreme pressure on all
resources, especially metals, fuels, and investment
funds. Brezhnev's response to this situation was to
insist upon the establishment of strict priorities
and a funneling of investment into "those concrete
links in which, at the cost of minimal expendi-
tures, one can get a maximum and rapid effect.
30 Oil production at the large Tuymazy field in Bashkiriya had
declined from 400,000 barrels a day to 80,000 over the past five or
six years, causing great concern among petroleum officials.
Authorities also foresaw the nossibility of a steer) decline i Tatar
production.
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In other words, Brezhnev resurrected the old notion of
"leading links" in the economy, so familiar to all who
had participated in economic campaigns of the Stalin
years-a notion that contrasted with the marginalist,
optimizing thinking that lay behind the 25th Party
Congress directives on energy.
The key passage dealing with energy in Pravda's
presentation of Brezhnev's speech declared:
Among the big interbranch problems there is none
more important than the fuel-energy problem.
Over the next 10 years ... oil and gas, first of all
from Tyumen, will retain a decisive role in
providing the country with fuel and energy. We
have successfully completed the first stage of the
program of the complex mastery of the mineral
resources and development of the production
forces of West Siberia. Now with all urgency
arises the need to realize the next stage. It is
important to concentrate resources and capital
construction possibilities on this truly great con-
struction project of our time, to buttress economic
with mass-political measures, having strength-
ened attention to it on the part of the Komsomol
and the press.
Coal will continue to occupy an important place
in the fuel-energy balance of the country in the
future too, the extraction of which will rise in
1978 to 746 million tons..:. Hydro- and atomic
energy will develop at exceptionally rapid tempos.
I- I
The "leading links" here were clear: within the
nonagricultural economy, the leading link was the fuel-
energy sector; within this sector the leading link was
hydrocarbons; and within the hydrocarbon branches
the leading link was development in Tyumen Oblast.
The concept of a "first stage" of Tyumen development
appeared here for the first time, although it had been
implied in a general way by what Muravlenko and
other advocates of heavier investment in Tyumen had
been saying in 1975-76. The purpose of the phrase was
precisely to justify a major increase in the resources
allocated to Tyumen. The phrase "all urgency" was
intended to convey a sense of critical need without at
the same time undercutting the carefully nurtured
propaganda image that the Soviet Union was not
vulnerable to-much less in the midst of-its own
"energy crisis." The references to "mass-political
measures," the Komsomol, and the press signaled the
initiation of a campaign. And the tag-end reference to
coal, hydroelectricity, and nuclear power maintained
the facade of continuity with the 25th Party Congress,
despite the actual shift in the whole policy emphasis.
The Pravda report, however, was short on details:
although it called, in effect, for a return to what we
have called the Hydrocarbon energy balance strategy,
it did not spell out how much stress was to be placed on
north Tyumen gas or how-in a broader sense-the
new policy line was to be implicated.
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One might have expected to find such details in
Baybakov's report on the 1978 plan to the Supreme
Soviet, but at most they were merely suggested.
Baybakov did talk about the need to increase oil and
gas reserves and the need to accelerate pipeline and
housing construction in West Siberia. But he also
declared that the increase in oil output in 1978 would
come not only from Tyumen but From other regions;
that gas development would occur in Orenburg, and
also in Turkmenistan, as well as in Tyumen; that coal
production should be increased inI the Donbass,
Kuzbass, and Ekibastuz (he ignoed Kansk-Achinsk);
that work should go forward on the 1,150-kV AC line;
that nuclear power development should proceed apace;
and-by implication-that the needs of other major
investment projects, such as Atoni mash, the Baykal-
Amur Mainline (BAM), and noni Black-Earth devel-
opment, had to be kept in mind. What Baybakov did
not say was even more significant: he did not mention
the Central Committee Plenum a~ all in the energy
section of his report; he did not say that Tyumen had
special priority; he did not mention Urengoy at all,
although he specifically mentioned Orenburg three
times; and he did not in any way suggest or imply any
change in the ener line established at the 25th Party
Congress.
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There was thus a sharp apparent contrast in December
1977 between the position attributed to Brezhnev,
which was held to be the party line, and the course of
action projected in the 1978 economic plan. The
divergence here could have been explained by
underlying conflict over policy, but it might also have
arisen from lack of time to meld the draft report on the
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plan with a conceivable last-minute shift by the
Politburo. On balance, later evidence tends to support
the conflict interpretation. However, Brezhnev's illness
in the second half of December and almost all of
January and his apparent absence from the scene on
many days in November, February, and March cloud
the picture.
What is clear is that the December Plenum of the
Central Committee specifically confirmed nothing
more than a shift in direction of energy policy, and
even this was not immediately given great publicity.
No detailed program was approved by the Plenum, and
the entire weight of Politburo authority appears not to
have been placed behind the Tyumen campaign until
after Brezhnev returned in April 1978 from his trip to
Siberia. Especially in December and January there
were signs that the full measure of the forthcoming
campaign had not been taken, even by supporters of
such a change."
In the interval between the December Plenum and
Brezhnev's trip the openness of policy was suggested by
intense lobbying efforts on behalf of investment in
Tyumen. Two weeks after the Plenum, Shcherbina was
the first person publicly to claim that the Plenum had
in fact introduced a new "strategy" for "further
development of fuel-energy." In the 11 January issue
of Literaturnaya gazeta, the first secretary of the
Writers' Union, Georgi Markov, was one of the first to
quote in full the 18 December Pravda version of
Brezhnev's remarks on Tyumen, as he announced a
major literary-propaganda blitz aimed at Tyumen. In
" In an article on Tyumen oil in Pravda on 16 December 1977, a
journalist favorably predisposed to Tyumen did not even hint that a
"Tyumen acceleration" had been approved at the Central Commit-
tee Plenum. Likewise, an article by the ardent Tyumen advocate,
Academician Trofimuk, in Pravda on 4 January 1978 contained no
reference to the December Plenum, to Brezhnev's support for
Tyumen, or to the "second stage" of Tyumen development. A major
propaganda "letter" of the Central Committee, the Council of
Ministers, and the Trade Unions published in Pravda on 14 January
failed to refer at all to the Siberian thrust or to Tyumen. Similarly, at
a Central Committee mass media meeting reported in Izvestiya on
19 January, Kirilenko, who mentioned the December Plenum and
Brezhnev's "propositions and conclusions," did not allude to the
Tyumen-first policy; nor was this noted as one of the themes stressed
at a meeting of the Council of Ministers attended by Kirilenko and
the following week's issue of Literaturnaya gazeta, the
Tyumen obkom first secretary, Bogomyakov, argued
forcefully that the December Plenum had indeed
ushered in a new era in energy production policy,
although only after a period of unnecessary vacillation:
Tyumen workers are orienting themselves to
produce not less than 305 million tons of oil and
155 billion cubic meters of gas in 1980. But what
about after that? How will extraction be in-
creased? This question undoubtedly worries many
people. Even quite recently there were not just a
few contradictory judgments in views on the
future. The directives of the December Plenum of
the Central Committee CPSU determine pre-
cisely the place of the Tyumen complex in
satisfying the needs of the country for oil and gas.
Bogomyakov laid the blame for past inefficient devel-
opment of Tyumen and for the need to undertake the
present catch-up campaign on Gosplan and various
ministries. Other articles in the next few months also
assigned blame for delays in Tyumen development,
drew favorable comparisons between Tyumen and
other energy-producing regions, and called for a
further shift of resources to Tyumen.
But the element of uncertainty that remained follow-
ing the December Plenum provided room for the
assertion of interests that crosscut Brezhnev's evident
intentions. Even at the Supreme Soviet session, the
representative of the Tatar Republic spoke far less
enthusiastically of Brezhnev's initiative at the
December Plenum than did his colleague from the
Bashkir Republic, whose categorical endorsement
suggested behind-the-scenes conflict. The Turkmen
spokesman explicitly complained of cutbacks in
Turkmenistan's 1978 oil program.
Had these speeches simply been insufficiently coordi-
nated beforehand? The answer-at least in the case of
Tatariya-would appear to be negative. In early
January, Bulgakov, the general director of the Tatar
Oil Administration, referred publicly to the need to
redrill three out of every four wells in Tatariya. At the
end of the month, at the annual winter meeting of the
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Oil Ministry Collegium, he dwelt on the need to
increase the recovery rate in Tatariya, bring small
fields into production, and supply more drilling equip-
ment, and he also observed that "the problem of
holding on to cadres seriously disturbs us." It was
precisely at this time that the campaign to dispatch
Tatar and other drilling crews to Tyumen was gaining
momentum-a development with which Bulgakov
himself was intimately involved.
The ambiguity surrounding the new policy line was not
altogether dissipated by the trips in quick succession to
Tyumen and other Siberian cities by Kosygin and
Brezhnev in March and early April 1978. Kosygin left
on 21 March and returned on the morning of 28
March, while Brezhnev left several hours after
Kosygin's return and came back to Moscow on 9 April.
Kosygin was accompanied by Baybakov, Dymshits,
and "a number of USSR ministers," who probably
included at least Mal'tsev, Orudzhev, and Shcherbina.
The composition of the delegation, which may well
have represented a rump gathering of the Energy
Commission of the Council of Ministers Presidium,
strongly suggests that its mission was to work out the
implementing details of the December Plenum
directives. The fact that three months had elapsed
before this delegation departed, despite Brezhnev's
admonition that Tyumen development should be
treated "with all urgency," suggests that
decisionmaking was held back by the absence of prior
contingency planning, conflict over policy, Brezhnev's
feeble health, or some combination of these factors.
Kosygin's delegation visited Orenburg (where it dealt
with gas questions), Tyumen city, the two key Tyumen
oil towns of Surgut and Nizhnevartovsk (Samotlor),
and Tomsk and Krasnoyarsk. Press comment on what
happened in Tyumen was exceedingly sketchy; the
only substantive information released was that ques-
tions related to the long-term development of Tyumen
had been discussed at gatherings of party and govern-
ment officials and specialists from the oil, gas, and
petrochemical industries. There was somewhat more
comment on Kosygin's visit to Krasnoyarsk. It focused
on development of the Sayan Territorial Production
Complex, natural resources, agriculture, and the
broader pattern of Siberian development. There was no
mention of Kansk-Achinsk.
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Brezhnev's visit to Tyumen was also treated
circumspectly in the press, receiving the least coverage
of any of the major stops on his tour despite the
paramount importance of the oblast. In his talk with
Tyumen party and economic leaders, the press indi-
cated, Brezhnev dwelt on "fulfillment of plans for
mastering mineral resources and developing produc-
tion forces," expanding the output of oil and gas,
economizing on material resources, and meeting
capital construction targets. He also issued unspecified
"concrete directives." A bit more information was
added in the account of Brezhnev's stop in Novosibirsk,
where he was reported to have demanded of the
Siberian Division of the Academy of Sciences, "We
expect still more in questions of the practical applica-
tion of science and in the solution of fuel-energy
problems, geological exploration, petrochemicals, ma-
chine building, and in other areas." In a long and
relatively detailed report of his speech in Krasnoyarsk,
there was no mention at all of Kansk-Achinsk, in
contrast with a pointed reference to the subject by the
kraykom first secretary, Pavel Fedirko.
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Perhaps the unprecedented visit to the same remote
province by two top leaders within a week's time was
the result merely of the fortuitous circumstance that
going through Tyumen is one way to take the Trans-
Siberian railway to the Pacific. Having initiated a
"turn toward Tyumen" at the December Plenum, one
might argue, it was only natural for Brezhnev to stop in
the oblast for a firsthand appraisal and for a pep talk
that would reinforce the message delivered by Kosygin
and his associates. From this perspective, the stop
would be viewed simply as an episode within the
framework of the broader personal, economic, and geo-
political considerations that led Brezhnev to travel
across Siberia: to demonstrate physical and political
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An equally plausible explanation, however, is that the
Kosygin-Baybakov-Dymshits and Brezhnev-Ustinov
visits represented two different approaches to dealing
with Tyumen. A noteworthy anomaly of the trips was
the near coincidence of the return of Kosygin and the
departure of Brezhnev. The timing here would appear
to have allowed little opportunity for face-to-face
consultation between the two. Had Brezhnev been
working in harmony with Kosygin and Baybakov, one
might have supposed that he would have delayed his
departure long enough for discussion and coordination
of his own positions with those arrived at by Kosygin's
delegation.
That there were high- and lower level differences of
opinion over Brezhnev's new line, which may or may
not have surfaced in the separate trips to Tyumen, is
strongly suggested by a convergence of other evidence:
? Baybakov's attitude. In a long article on technologi-
cal progress that was published in January, Baybakov
managed to avoid any reference to the December
Plenum or to Brezhnev, while stressing the desirability
of heeding professional advice. Likewise, in a July
article on economic "effectiveness" he completely
ignored the subjects of Siberia and oil and gas.
? Gosplan-based negativism. One of the most striking
manifestations of disagreement with the Brezhnev line
was provided by the publication of two articles by
Yatrov, the director of Gosplan's Scientific Research
Institute of Complex Fuel-Energy Problems. The first,
printed two days after Brezhnev's departure for
Siberia, constituted a thoroughgoing restatement of
the 25th Party Congress Combined Resources line on
energy production, with no stress on Brezhnev's role or
on the Siberian campaign, and no specific reference to
Tyumen. Without identifying the source, Yatrov
included an entire paragraph taken from Kosygin's
report to the 25th Party Congress stressing the USSR's
status as the only energy self-sufficient major world
power.32 Yatrov's second article, devoted to the offbeat
32 Krasnaya zvezda 30 March 1978. The article bracketed references
to Brezhnev and the December Plenum between references to the
25th Party Congress and the December 1977 session of the Supreme
Soviet (at which Baybakov had virtually ignored Brezhnev's line)
and asserted in unmistakable terms that the line had been set "by the
25th Party Congress." While touching upon Brezhnev's theme of the
paramount role of oil and gas in the next decade, and mentioning
West Siberia (along with Komi and Orenburg), Yatrov devoted
much more attention to Kansk-Achinsk and Ekibastuz coal, as well
subject of geothermal energy, also ignored Brezhnev
and the role of oil and gas. In addition, an article
reiterating the 25th Party Congress line was published
in the May issue of Gosplan's journal, and an article
tilted toward a Combined Resources approach ap-
peared in the June issue of a journal closely tied to
Gosplan.
? Clashing Pravda and Izvestiya editorials. Histor-
ically, Pravda has often tended to reflect party-
oriented positions, while Izvestiya has reflected op-
posed thinking in the government Council of Ministers.
Following Brezhnev's return, Pravda and Izvestiya
published their own editorials on the Siberian trip.
Overall, the Izvestiya editorial was substantially less
supportive than Pravda's.33 The formal resolution
approving Brezhnev's trip adopted by the Central
Committee, Presidium of the Supreme Soviet, and
Council of Ministers incorporated compromise
language.
? Brezhnev's remarks at the Komsomol congress. The
tone of Brezhnev's comments on Tyumen in his speech
in April to the Kosomol congress was defensive and
argumentative. He found it necessary on this occasion
to justify the large investment in Tyumen and to argue
that it had paid off. Tyumen was not a dead end: "We
can still live off of Tyumen reserves for many years,"
he declared. But, it was necessary "to double-treble the
volume of all operations there." He asserted that this
would require both new material technical expendi-
tures and an influx of people there, that supply orders
destined for Tyumen originating elsewhere in the
country should be given the highest priority, and that
Komsomol groups should monitor fulfillment of this
requirement.
? Kosygin's promotion of Kansk-Achinsk. In a report
to the Presidium of the Supreme Soviet in May,
Kosygin "drew attention, specifically, to the progress
of realization of proposals for accelerating the elabora-
tion and implementation of measures for setting up the
Kansk-Achinsk fuel-energy complex, for increasing
71 Pravda on 18 April 1978 and Izvestiya on 20 April 1978. The
Izvestiya article had a weaker title than Pravda's; implied that less
of a response was required from party meetings and aktivs that
would now discuss the implications of the trip; stressed the 25th
Party Congress; emphasized the need for regional balance; confined
the "new stage" to East Siberia; mentioned coal; avoided saying that
the share of allocations to the east would increase; and did not lay the
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the reserve of capacities in the energy systems of the
country." In his speech on the 61st anniversary of the
Revolution in November, Kosygin ignored the
December 1977 Plenum and West Siberia. Instead he
emphasized raising the proportion of atomic energy
and coal in the fuel and power balance, developing
the Kansk-Achinsk and Ekibastuz coalfields, long-
distance high-voltage power transmission, and econo-
mizing on gas and oil (the "irreplaceable sources of
chemical raw materials").
? Esoteric criticism of Baybakov. The most significant
implied criticism of Baybakov (and probably of
Kosygin as well), although perhaps the most elusive,
appeared in Brezhnev's memoir, Rebirth, published in
May 1978. In a paragraph that was partly cribbed
from a Pravda editorial of 18 December and lacked
any relation to the historical material in which it was
embedded, Brezhnev dwelt on the importance of
concentrating resources on West Siberia and reiter-
ated the "leading links" philosophy. Adherence to this
philosophy constituted one of the key elements of "the
art of planning, and indeed of economic leadership in
general." A direct slap at Baybakov appeared during
May in the Central Committee's theoretical journal,
Kommunist, which called attention to the fact that the
"Ministry of Oil" had liquidated geological pros-
pecting in north Tyumen in 1953. Any Soviet reader
with the slightest familiarity with the oil industry
would have been aware that Baybakov had been
Minister of Oil in 1953 and that he was being held
responsible for a situation with obvious current
parallels.
? Debate at the roundtable meeting on West Siberian
development. In June 1978, discussion at a roundtable
meeting on West Siberian development organized by
the Tyumen obkom and the editorial boards of several
journals revealed the persistence of a number of key
unresolved issues even after Brezhnev's trip to
Siberia."
The priorities that have emerged in practice from
Brezhnev's new line include an intensified emphasis on
oil extraction in Tyumen, a secondary stress on gas,
and a deemphasis of coal. It would almost certainly be
incorrect, however, to say that these priorities are
embodied in some coherent, comprehensive program.
Following Politburo authorization in late 1977 of a
reformulation of the regime's general energy produc-
tion strategy, planners and specialists were faced with
the task of generating, once again, branch programs
that corresponded to prescriptions set from above. In
the meantime, adjustments are presumably being
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'? The most fundamental issues dealt with investment, oil reserves,
planning, and transportation. Investment issues that were raised
included the effectiveness (or lack of it, according to some Gosplan
officials) of capital investment in West Siberia; the desirability of
broad (hydrocarbons plus petrochemicals and chemicals plus electric
power plus metallurgy) versus narrow (hydrocarbons) development
of Tyumen; the optimum rate of investment in infrastructure and
prospects for long-term habitation of the region; conflicts of interest
over investment between Tyumen and other regions; and the overall
priority to be assigned to Tyumen investment. One economist, B. S.
Vaynshteyn, was said to have emphasized that "the significance of
the Tyumen complex is so great for the economy of the country, and
the problem of providing it with all the necessary reserves is so
important," that it was necessary "first to draw up a balanced plan
for the oil-gas complex of Tyumen Oblast, and then include it as one
of the basic blocks in the plan of development of the economy of the
USSR. All the necessary `input' resources of the Tyumen program
must be satisfied under all conditions." This proposal, considered
paradoxical by the editors, implicitly called for assigning Tyumen
development a priority equivalent to military production. The issue
of oil reserves and production possibilities was touched upon by the
Tyumen geologist I. I. Nesterov, who called upon Gosplan to
increase investment in exploratory drilling and denounced skeptics
who doubted the existence of further large oil reserves in Tyumen
and by the Tyumen economist L. P. Guzhovskii, who appealed for
the "creation of strategic reserves in the oil-extraction industry" in
order to compensate for unanticipated declines in oil production
elsewhere. Guzhovskii was also one of the speakers who lamented the
absence of an integrated program for West Siberia; in his opinion,
failure by Gosplan (notoriously hostile to this idea) to employ
optimizing mathematical models in planning West Siberian develop-
ment was likely to result in enormously costly miscalculations.
Transportation was stressed by Ya. Mazover of Gosplan's SOPS,
who dwelt on the "gigantic problem" of coping with the rapidly
increasing energy deficit in the western USSR. Mazover's pitch for a
rapid acceleration of natural gas production and transportation was
seconded by Nesterov, who urged that Soviet steel production
capacity be enlarged in the 11th Five-Year Plan to meet the
enormous need for large-diameter gas pipe. (See Vopros Ilos ti
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made "by eye" in the existing plan balances, with no
little pulling and hauling by interested ministries.
In all likelihood the key factor that led to a reversion to
the Hydrocarbon strategy was what a majority of
leaders must have perceived as a clear and present
danger of slippage in oil production. The "Tyumen
acceleration" in the midst of the current five-year plan
indicates that the Soviets appear to have been unable
to meet immediate petroleum requirements while
maintaining a policy commitment to longer term
solutions to the energy problem.
The Hydrocarbon approach, of course, does have
certain positive enticements. It imposes high costs, but
these are lower than the immediate cost that would be
entailed by a sudden implementation of the Big Gas or
Big Coal strategies. It depends on familiar technology
and does not demand the development of radically new
and untested transportation systems. Probably it
demands less foreign involvement than a gas-based
strategy, as long as it does not include major offshore
development.35 Also, it lends itself well to the technique
that can get some results under Soviet conditions-the
party-led mobilizing campaign.)
The Present Tyumen Oil Campaign
A central element in the present campaign is the
reluctant decision to make substantial increases in
investment in Tyumen. Commenting on this issue, the
Tyumen obkom first secretary, Gennadiy Shmal',
referred in March 1978 to the enormous costs that now
had to be met in West Siberian development. The
general magnitude of investment demands is indicated
by the statement that "by the end of the five-year plan
it will be necessary to fulfill capital construction work
in West Siberia greater than that at BAM, KamAZ,
VAZ and `Atommash' taken together." Uncertainty or
" Soviet concern with offshore oil and gas development was
manifested in the creation in August 1978 of a new Main
Administration for Exploration and Development of Offshore Oil
and Gas Fields. The establishment of this unit within the Ministry of
Gas and the transfer to it of personnel from the Ministries of Oil and
Geology reflect a major political victory for the Minister of Gas,
Sabit Orudzhev. Whether the Ministry of Gas is as well suited to
organize offshore production as the more experienced Ministry of
Oil, which would have had a larger stake in it and which has a record
conflict over the precise volume of investment is
suggested by Brezhnev's ambiguous reference in his
April 1978 speech at the Komsomol congress to the
need to "double-treble" the amount of work in West
Siberia.
Constraints in the allocation of resources and person-
nel for geological exploration has been a sore point
with Tyumen authorities for years. In 1976 and 1977
there were heavy hints of discrimination against
Tyumen on this score, and a program to increase
exploration was mounted in 1977. The 1978 target for
exploration drilling by Glavtyumengeologiya was in-
creased by a third over 1977. However, a top official of
Glavtyumengeologiya indicated in March 1978 that
his organization would be hard pressed to meet this
goal.36 One remaining critical issue was that of drilling
teams for geological exploration, despite the apparent
priority assigned to Tyumen by the December Plenum.
In 1978 there were 56 geological drilling crews in
Tyumen; to meet the 1980 drilling plan, according to a
top official of Glavtyumengeoligiya, there will have to
be 100 crews. The persistence of competition between
regions for personnel was illuminated by a remark of
Farman Salmanov, chief of Glavtyumengeoligiya, in
May 1978:
I'm not convinced ... by assertions that there
aren't enough drillers. There are 2,300 drilling
brigades in the branch, and so it's necessary to
shift a considerable part of them there where
exploitation will give the largest geological payoff;
namely, to us, to the Tyumen land!
Even more crucial in the short run is the need rapidly
to increase oil development drilling in West Siberia. In
1977 this was clearly an area of deep concern to the
Soviet authorities. Still greater anxiety was suggested
in 1978, when the real magnitude of the oil drilling
required to meet the five-year plan was disclosed. On
the basis of data released in 1978 the picture of drilling
requirements given in table 2 came into focus. It is
apparent that to meet the five-year plan target it would
36 The problems mentioned included major difficulties with equip-
ment repair, unexpectedly high pressures that brought drilling to a
standstill in northern regions, and a high frequency of breakdowns in
drilling operations. The official strongly implied that "a concern for
the longer term" was not characteristic of the way exploration in
Tyumen was being dealt with by higher authorities. (Sotsialisti-
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Farman Salmanov
Chief of Glavtyumengeoligiya
Drilling Requirements for
The Ministry of Oil, 1970-80
West Siberia
Other Total
1970
1.0
8.0
9.0
1971
1.2
8.0
9.2
1972
1.4
8.5
9.9
1973
1.8
8.7
10.5
1974
2.3
8.7
11.0
1975
2.8
8.9
11.7
1976
3.4
8.7
12.1
1977
3.8
9.0
12.8
1978
5.0
9.3
14.3
1979
7.5 est.
9.0
16.5
1980
9.3
19.3
In 1977 plans were drawn up to transfer drilling
brigades from the Tatar, Bashkir, Kuibyshev, and
Saratov fields to Tyumen, and some brigades were
actually dispatched before the end of the year. These
plans were accelerated following the December Ple-
num. According to a decision taken by the Ministry of
Oil, the so-called tour of duty or expedition system was
the model to be employed. Under this system, the
brigades would remain under the jurisdiction of their
former drilling administrations and would be flown to
Tyumen for two-week tours and then flown back to
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development drilling in 1980 as in 1977.
All authorities agreed that it would be impossible to
accomplish this objective with the number of oil
drilling rigs and brigades that were in Tyumen at the
beginning of 1978. According to one account, 180
drilling brigades were required to meet the five-year
drilling plan, but as of January 1978 there were only 83
in Tyumen. Oil drilling requires highly skilled labor,
and consequently the total number of drilling brigades
available in the country cannot quickly be expanded.
To meet Tyumen's needs it has been necessary to shift
a significant number of brigades from other regions,
which has inevitably exacerbated the problem of
holding stable the level of extraction in older fields.
their homes west of the Urals.
The first brigades were drawn from the Urals-Volga
fields of Tatariya, Bashkiriya, Kuibyshev, and Saratov
while later groups were to come from as far away as
Stavropol', the Ukraine, and Belorussia. As of the end
of June 1978, 21 of these new drilling brigades had
been organized, out of a planned total for 1978-it
would appear-of 25. In 1979 it is planned to create 35
additional drilling brigades in Tyumen. The "flying
brigades" were assigned about 10 percent of Tyumen's
oil drilling plan for 1978. 25X1
From the outset there were serious hitches in transpor-
tation, housing, and production arrangements for the
new drilling brigades. Because of shortages and failure
by suppliers to deliver sufficient additional drilling
rigs, competition arose between the newcomers and
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One of the ':/lying brigades" arrives
in Tyumen, having been transferred from
oilfields elsewhere in the country
drilling administrations subordinate to Glavtyumen-
neftegaz-with the latter inevitably the winners. The
new brigades are apparently in the unenviable position
of being responsible for work that may really not count
toward the official plan fulfillment of either Glav-
tyumenneftegaz or their base administrations. Not
surprisingly, the are underfulfillin their quotas so
far.
Similar problems have arisen in implementing the
directives of the December Plenum in construction,
transportation, and electric power supply, which for
years have been chronic bottlenecks in Tyumen
development. The crux of the difficulty in all three
fields has been intense demand elsewhere for resources
and manpower, and incentive structures that motivate
the various construction and transportation ministries
and the Ministry of Power and Electrification to hold
back on activity in Tyumen.
Following Brezhnev's trip, and in response to much
criticism, Gosplan issued a well-modulated promise to
increase the capacity of construction organizations in
Tyumen in 1979 and 1980. It followed this move by
announcing in September a series of measures affect-
ing construction, transportation, oil equipment, and
scientific research in Tyumen. There were also pledges
in West Siberia, is but one infrastructure Copyrighte
problem accompanying Tyumen development
by transportation ministries and the Ministry of Power
and Electrification, extracted under heavy fire, to do
better by Tyumen in the future. These moves have not
quieted criticism from Tyumen, nor are they likely to
do so. The campaign that Brezhnev has set in train
cannot help but pry some resources loose from the
ministries concerned, but it has not changed whatso-
ever the fundamental structure of their interests; and
these interests will continue to be expressed in the
planning process and policy implementation.
The same observations apply with even greater force to
the campaign unleashed with great fanfare in May
1978 to assign top priority to Tyumen deliveries from
plants all over the USSR. This campaign has undoubt-
edly been getting some supplies to Tyumen faster than
they would otherwise arrive. The prospects for its long-
term success, however, are questionable. The cam-
paign is carried along strictly by "moral incentives";
that is to say, it tends to run counter to the natural
interests of each and every factory and ministry that
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changes its established priorities in order to expedite
deliveries to Tyumen. More important still, the effec-
tiveness of the campaign is limited by the backward
linkages to other sectors of the economy of goods
required by Tyumen. For example, the possibility of
supplying Tyumen with more and better drill pipe,
pumps, compressors, large-diameter pipes, high-volt-
age transmission lines, and so on, quickly runs up
against the allocation of metal within the economy as a
whole and the capabilities of the metallurgical indus-
try. There is very little slack available in the supply
side of the economy, and once it has been taken up
Tyumen growth will be directly constrained by the
structural weaknesses of the Soviet economy as a
whole. In fact, the imposition by fiat of unplanned
changes in the scheduling of deliveries can only have
unfortunate ripple effects elsewhere. deliveries
A central issue in Tyumen oil development in the
current five-year plan has been where to concentrate
the extraction effort. The alternatives have been either
to attempt to develop a larger number of new small
fields, with all the problems this entails, or to attempt
to meet the plan by developing fewer new small fields
while increasing drilling and extraction above
projected capacity at the older West Siberian fields-
notably Samotlor. The price of the latter course of
action is to reduce the ultimate recoverable yield from
the older fields and produce a steeper rate of decline
after the four years or so in which the fields are
produced above maximum efficient rates.
The late chief of Glavtyumenneftegaz, Viktor
Muravlenko, who died in 1977, felt that the only
rational course of action left by 1976 was to undertake
immediate development of a large number of small
new fields in Tyumen. Such a policy would maintain
growth in oil production while preventing further
damage to Samotlor. Thus we find that in January
1976, Muravlenko was calling for the development
during the forthcoming 10th Five-Year Plan of 62 new
deposits in West Siberia. Three months later, however,
a local Tyumen official implied that the five-year plan
target was only 36 new fields, and then Deputy
Minister of Oil Mal'tsev stated that the target was
"about" 30
Nikolay Mal'tsev
Minister of Oil
In 1976 it is asserted in Soviet sources, seven new fields
were developed. According to the new head of Glav-
tyumenneftegaz, Arzhanov, in order for Tyumen to
meet its plan for 1977, eight more new fields had to be
developed, or a total of 15 for 1976-77. By the third
quarter of 1977, however, slippage in the five-year plan
target to 28 and then 25 new fields indicated that
something was amiss. In December it was revealed that
during 1977 work had "started" on only four new
fields. Precisely how many new fields were actually in
production by the end of 1977 is unclear. While
Minister of Oil Mal'tsev appeared to claim that all four
new fields were brought into operation, another source
states that 10 new deposits were opened up in 1976-77,
which would make the 1977 number only three
(assuming that seven new fields were really brought
into operation in 1976). In January 1978, David
Shipler of The New York Times was told that "only 20
to 25" fields were being worked at this time in
Tyumen. Since about 16 are said to have been in
operation at the end of 1975, this would imply that at
most nine new fields were brought into production in
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Feliks Arzhanov
Current chief of Glavtyumenneftegaz
1976-77. All sources agree that the target for 1978 is
eight new fields. Once again, though, the five-year plan
goal has apparently been lowered: in April 1978
Arzhanov stated that the target was 23 new fields,
which he reduced to 22 a month later. Later references
mentioned 25 new fields. Assuming that 10 new fields
were brought into production in 1976-77, and that
eight will be introduced in 1978, only four to seven
would be left for the remaining two years-an
apparent anomaly that might be explained by diffi-
culty of access to these fields
The revision downward of the number of small fields
being developed through 1980 has two implications.
First, the halving of the small-field target in early
1976, a clear defeat for Muravlenko and like-minded
proponents of steady Tyumen oil development, re-
flected the ascendance of the Combined Resources
strategy at the time of the 25th Party Congress.
Operationally, it implied a decision to limit investment
in Tyumen, while meeting oil needs through more
intensive exploitation of Samotior in the 1976-80
period. Looked at charitably, this decision represented
an attempt to buy time for developing alternative
energy resources. A more realistic appraisal would
probably be that it was designed to cut costs during
1976-80 regardless of the longer term consequences: it
was another example of energy decisionmaking being
driven by short-term expediency. Secondly, the serious
shortfall in the opening up of new fields in 1977 and the
further reduction of the five-year plan target to only 22
to 25 fields quickly revealed the lack of realism in the
leadership's treatment of the small fields. As
Muravlenko and others had been saying for a number
of years, there was no cheap solution to further
development of Tyumen. The leadership's about-face
since December 1977 is a grudging acknowledgment
that these people were right
Stabilizing or slightly increasing the level of output at
Samotlor through more drilling and some combination
of more submersible pumps and gas lift is strategic in
maintaining the overall level of Soviet oil production at
the present juncture. But the cutting edge of any
significant growth in oil production, the key to the
future of the oil industry over the next 10 years (so
Brezhnev in effect tells us), is development of the small
fields. These fields, which generally lie farther away
from the Ob waterway and established lines of
communication, in the swamps of central Tyumen,
pose acute problems of road building, electric power
supply, and pipeline construction. The problems are
magnified, and the costs multiplied, by the
geographical isolation of individual fields (see the map,
page 51). During 1978 a number of articles have dealt
graphically with the difficulties presented by the small
fields. These articles convey a clear impression that
plans for developing the small fields will be met only
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with great difficulty and not on schedule." Output at
the few new fields developed to date, moreover, is said
to average less than half of the planned initial volume.
Urengoy Gas Development
According to Minister of Gas Orudzhev, restraint on
investment in the gas industry was enforced in 1976-
77. During the course of 1977 increasing attention was
paid to Tyumen gas, including pipeline projects and
the Urengoy field. Some work had already been
proceeding on this field itself since 1974, and prelimi-
nary work on the Urengoy-Chelyabinsk pipeline right-
of-way began in 1977. Nevertheless, a decision appar-
ently taken around the time of the December 1977
Plenum called for an abrupt acceleration of the whole
pace of development.
Urengoy is the largest known natural gas and conden-
sate deposit in the world, measuring 167 kilometers
long and 35 kilometers wide. Its multilayered structure
contains two main gas pools, with currently estimated
reserves of over 5 trillion cubic meters-equal to total
"A good example is provided by an article in Trud, 11 April 1978. A
typical new field, such as Povkhovsk, lies 200 kilometers away from
Nizhnevartovsk (Samotlor) in a wasteland of taiga, lakes, and
swamps. Here, as at other new fields, the "golden rule" of
development that specifies that roads, electricity, and pipelines must
run ahead of oil recovery, rather than along with it, much less lag
behind it, was being violated. Povkhovsk was supposed to go into
production in 1977, but did not; it would be lucky to operate in 1978.
The only way to deliver freight to it was by a costly winter road or
even more costly helicopter transport. Power was supplied by diesel
engines. And a third of the pipeline designed to carry the oil out had
not yet been built. To meet development requirements in the
Nizhnevartovsk region, at least 216 kilometers of hard-surface roads
should have been built in 1978. The assigned contractor's capacity,
however, was barely 60 kilometers. In Tyumen as a whole, minimum
estimates of required powerline construction in 1978 were at least
twice the capacity of the powerline construction trust. The railway
from Tyumen city to Surgut and Nizhnevartovsk, the "needle's eye,"
was so jammed that one ban after another prohibits trains carrying
urgently needed freight from heading toward Tyumen. Vitally
needed drilling rigs have been sitting for five months somewhere in
Sverdlovsk Oblast. The article summed up:
There will be oil in the long run, there is no doubt of this. But
the extreme tension with which it is now being extracted,
especially at new fields, verging on a breakdown, is hardly
justifiable. Experience-our own, unborrowed, tested exper-
ience-has taught us the strategy and tactics of development.
So why do we start over each time, forgetting that reliable and
faithful keys to the mineral riches of Tyumen have been found
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US gas reserves less those in Alaska. The decision to
move ahead rapidly on Urengoy entailed an increase in
the tempo of drilling and field preparation, aiming at
production of 58 billion cubic meters per year in
1980-that is, development to almost the level
achieved at Medvezh'ye over a six-year period. In a
single year, 1978, a large-diameter pipeline was to be
laid between the Vyngapur field south of Urengoy and
Chelyabinsk, and gas from Vyngapur was to reach
Chelyabinsk in the third quarter of 1978. This has in
fact been accomplished. (The normal time allowed for
construction of such a pipeline is said to be three
years.) In 1979 the connecting link from Urengoy to
Vyngapur is to be added, completing the first line of
the Urengoy-Chelyabinsk trunk system, which will
subsequently be extended to the Volga region. In the
meantime, a line connecting Urengoy with Nadym was
to be built in 1978, allowing some Urengoy gas to be
immediately transported west through the Northern
Lights and Urengoy-Center systems.
The suddenness of the decision, and perhaps contro-
versy over its adoption, was suggested by the way it was
made public. At the December 1977 meeting of the
Supreme Soviet, Baybakov failed even to mention
Urengoy, but by February 1978 it was being called one
of the "largest construction sites of the five-year plan."
The first public glimpse of the decision appears to have
been offered by Shcherbina, who stated in an interview
at the end of December 1977:
The Urengoy gas deposit has become a main
construction site, which in its scale much exceeds
the famous Samotlor. The schedule is extremely
tight. Never before has the task been set of
building in a single year a pipeline of 1,421
millimeters stretching 1,500 kilometers-from
Urengoy to Chelyabinsk.
In his letter of congratulations in early January to
Nadymgazprom, the branch of the Tyumen Gas Ad-
ministration responsible for Medvezh'ye and Urengoy,
Brezhnev provided what appears to be the most
authoritative public reference so far to the Urengoy
decision by observing eliptically at the end of his
greetings:
The Central Committee of the CPSU notes with
satisfaction that you are constantly striving to
multiply results achieved and already in the next
few years intend to solve one of the most
important links-to master the unique Urengoy
gas deposit.
A decision of the magnitude involved here would have
to be made at a level not much below the Politburo. By
presenting the Urengoy acceleration as a matter of
local initiative, Brezhnev was deliberately skirting the
question of authorization of this move. In contrast, the
Tyumen obkom first secretary, Bogomyakov, soon
after identified Brezhnev himself as the source of
initiative, alluding to "the mission set by comrade
L. I. Brezhnev to master in an accelerated fashion the
unique Urengoy deposit."I
Other evidence confirms the abruptness of the policy
shift on Urengoy. Completion of the Surgut-Urengoy
railway was pushed ahead to 1979, rather than 1980.
(This schedule will probably not be met.) The head of
the Urengoy Gas Construction Administration stated
in May 1979 that "literally in several months the
tempos of construction grew five times." Transporta-
tion planners in Tyumen were taken off guard. There
also appeared to be more than the usual degree of
disorganization in implementation of the decision
The immediate reason for the sudden concentration on
Urengoy is indicated by the crash construction of the
Urengoy-Chelyabinsk pipeline: namely, an energy
shortage in the Urals heavy industrial region. Despite
years of talk, the "Southway" route had never been
developed. As Pravda observed, this was "a completely
new outlet direction for Soviet gas. The trunkline will
link the Tyumen North with the industrial Urals by the
shortest route." And Izvestiya circumspectly noted
that there were "growing demands for [Tyumen gas]
in the industry of the southern Urals."
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Repeated statements have been made indicating that
no comprehensive program exists for the present crash
development of Urengoy. The same source just quoted
observes that "scientists and planners are now studying
the question of a sharp increase in the size of Urengoy"
(emphasis added). In a speech delivered in May, the
chief of Glavtyumengeologiya, Salmanov, concen-
trated on "the important problem of framing scientifi-
cally based programs both for the region as a whole
and for the individual most important objects of the
complex. Urengoy, in particular, begs for such pro-
gram." And a highly critical description of what is now
going on in Urengoy also published in May revealed
that relentless pressure from above for immediate
output in 1978 was compelling administrators on the
site against their better judgment to repeat all the
worst mistakes committed in the development of
Medvezh'ye:
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Gennadiy Bogomyakov
Tyumen obkomfirst secrtary
The longer term Urengoy development plans are
unclear to the outside observer, and probably have
been unclear to the Soviets themselves. Even after
December 1977 there appears to have been consider-
able indecision about when and where pipelines would
be built. Although there had earlier been talk in a
general way of multiple pipelines along the Urengoy-
Chelyabinsk route, only in mid-1978 was it announced
that a decision had been taken to build a second
Urengoy-Chelyabinsk line by the fourth quarter of
1978 and a third line before the end of 1980. After
that, there was no clear policy:
There exist other proposals regarding direc-
tions for the transport of Urengoy gas. The
Ministry of Gas, the Ministry of Construction of
Petroleum and Gas Industry Enterprises, and
other interested organizations must quickly com-
plete their study of this problem so as to lay down
a precise work program for the long-range con-
struction of gas pipelines.
But here they are, having begun a new and
enormous job, forced to put it in the old rut.
Already this year there must be the first billions of
cubic meters of Urengoy gas-but neither roads,
nor normal housing, nor an industrial base:
everthing slipshod, all superfast, as if there were
no time to calculate, to reflect and, finally, to
infuse development with all the laws of the end of
the seventies of the twentieth century. 125X1
Not only is there no program for the immediate future,
there also appears to be no agreed policy for the longer
term. Serious reservations were evidently entertained
in late 1977 about the enormous costs of gas develop-
ment in north Tyumen. The chief of the Tyumen Gas
Administration, Altunin, has indicated that this atti-
tude could be found in "planning organs, ministries,
and departments." Although Minister of Gas
Orudzhev made a ritual declaration in February 1978
that the Ministry of Gas "wholly and fully approved
the decisions of the December [1977] Plenum of the
Central Committee and has accepted them for
unswerving execution," and also acknowledged the key
future role of Tyumen gas, he probably did so to
indicate public acceptance of a policy with which he
had privately disagreed. In October 1977 he had
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supported adoption of a special conservation law that
would have cut back on the rate of gas development; in
March 1978 he spoke privately of the possibility of
Soviet gas production peaking in the 1980s; and in
June he restated in Pravda his familiar argument on
the need to save gas.
However, the extraction of gas would increase so
rapidly in the next few years that present large-
diameter pipes would no longer be able to cope with the
task. To meet the demand for Tyumen gas:
It will be necessary to build two or three dozen
superlong-distance lines. Their construction will
demand many tens of millions of tons of steel and
colossal simultaneous capital expenditures. This is
unreal. It is necessary to seek another path for
solving the transport problem.
Meanwhile, old advocates of the Big Gas strategy were
once again presenting their case. The situation, of
course, had changed. Urengoy development of 1978
was in no way equivalent to the "Big System"
considered in the 1972-75 period; the capacity of the
Urengoy-Chelyabinsk line was only 30 billion cubic
meters per year, not 300 billion. Nevertheless, as
additional lines are added there could be a convergence
in practice with what had earlier been proposed
The most comprehensive statement of the Big Gas
argument appeared early in 1978 in an interview given
by Shcherbina. Shcherbina admitted that the costs of
north Tyumen gas development were huge, but as-
serted that there was no other choice.
In the 10th Five-Year Plan the entire growth of oil
and 40 percent of the growth of gas of the country
will come from West Siberia. This situation, as is
evident, will not change in the foreseeable future.
Now it is already perfectly clear that in the longer
term many hundreds of billions of cubic meters of
gas can be extracted per year. Reserves will
permit organizing extraction for a long period
with stfficient reliability. (Emphasis added)
0
Shcherbina maintained that in the immediate present
there was no alternative to building large-diameter
trunklines, each capable of carrying 30 billion cubic
meters per year: "We urgently need them. There's no
other way without them." The time factor was
important here. Only a year or two was needed to build
a single 1,420-millimeter diameter pipeline sufficient
to fuel 17-19 million kilowatts of generating capacity,
or "more than the total capacity of all the hydroelectric
stations now operting on the Enisei and the Angara."
According to Shcherbina, the key was "unorthodox
ideas, the capacity to think originally, to fantasize, and
to organize the embodiment of these ideas and
fantasies in concrete actions."
The way out of the dilemma, Shcherbina argued,
involved two parallel courses of action. The first was
adoption of the idea the "Tyumentsy" had proposed
back in 1968-69: building huge gas-fired power plants
to generate electricity, which could then be transmit-
ted beyond Tyumen by high-voltage lines." This
system of power stations, with a now-projected capac-
ity of 60,000 to 70,000 megawatts (equivalent to 15 to
17 Bratsk hydroelectric stations), could start with the
Surgut and Tobol'sk power stations and a third station
of 7,000 to 8,000 megawatts that should be built in the
region of Sergino. The power plants would burn
natural gas and associated gas that was now being
flared. The second course of action was to shift in the
"near future" to transportation of chilled gas through
the "practically indestructable" Paton multiwalled
pipes, which would more than double the carrying
capacity of a large-diameter pipeline. This intermedi-
ate step would be followed by transportation of
liquefied gas, "a very complex business" that would
nevertheless permit a sixfold increase in pipeline
capacity.
3e In Shcherbina's words:
Approximately in 1968-69 the Tyumentsy proposed begin-
ning construction in the north of thermal electric stations
based on local natural gas with a total capacity of 20-30
million kilowatts. The idea, unusual to many, was rejected
on the basis of economic calculations: the cost of the
electric stations and high-voltage lines was higher than
that of a pipeline. These objections, let us state directly,
bore a scholastic character. However, the draft was not
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In addition, Shcherbina strongly endorsed a change in
policy that would effect a much more rapid develop-
ment of refineries and the petrochemical industry in
West Siberia, construction of product pipelines to the
European USSR, and expansion of a variety of energy-
intensive, bulk-output chemical industries. "To be
sure," he observed, "all of this demands the solution of
a broad range of tasks-technical, economic, and
social, and the efforts of many ministries and
departments. Naturally, not a little time will be spent
on this. But nevertheless we have to deal with these
problems." Shcherbina obviously saw himself as the
leader capable of implementing this vast scheme
During 1978 some or all of Shcherbina's ideas have
also been put forward by other authorities, most of
them long-identified with the Big Gas position. Both
Nekrasov of Gosplan's SOPS and Bogomyakov have
pushed for the construction of massive gas-burning
power plants in Tyumen. Academician Aganbegyan
has privately endorsed accelerated gas development
because of limited oil reserves and has dwelt on the
need to introduce chilled gas transmission, perhaps
within five years. Bogomyakov's subordinate in the
Tyumen obkom, Shmal', has echoed the earlier Big
Gas vision of a production level in Tyumen of 300-350
billion cubic meters per year. According to Shmal',
Urengoy will take the torch from Samotlor and
become the main source of energy supply in the years
1980-95. These are all, of course, simply personal
opinions. But the very fact that they are being
expressed demonstrates the open horizon of energy
policy. Especially relevant here is the power plant
proposal, which has major negative implications for
investment in Kansk-Achinsk coal development.
Combined Resources positions have continued to be
aired since December 1977, but without great vigor.
The difficulties of meeting current production and
development targets in both coal and nuclear power
may have dampened enthusiasm; and the climate is
less receptive to longer term strategies of dealing with
the energy problem than it was in 1976. The case for
Kansk-Achinsk does continue to be expressed. As
noted above, Yatrov, the director of Gosplan's Institute
for Complex Fuel-Energy Problems, stressed Kansk-
Achinsk in his defense of the Combined Resources line
at the end of March 1978, and Kosygin lent his support
to the project in major speeches in May and Novem-
ber. There have also been articles in the press on
Kansk-Achinsk. However, actual development of
Kansk-Achinsk, in particular work on the Berezovo
field, is progressing very slowly, and Minister of Coal
Bratchenko has not indicated any expectation of a
sudden improvement in the situation)
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In 1978 there continues to be major uncertainty
about how Kansk-Achinsk coal will ultimately be used.
The need for Kansk-Achinsk energy in Siberia alone
appears to be acute. A scientist wrote in the
3 September 1978 issue of Sotsialisticheskaya
industriya:
Calculations have shown that the rate of develop-
ment of Siberia is such that it is necessary every
two years to put into operation such a power
engineering giant as the Krasnoyarsk Hydroelec-
tric Station. And it will be necessary to do this
every year during the next five-year plan! But it is
clear that it is impossible to put into operation
[this frequently] a hydroelectric station of the size
of Krasnoyarsk. The only way out is to burn
Kansk-Achinsk coal, which is most accessible and
economically very profitable.
To help meet this demand, construction was scheduled
to begin in 1978 on the first energy block of Berezovo
station in the Kansk-Achinsk region. This first giant
Siberian thermal power station, with a projected
capacity of 6,400 megawatts, will be the largest of its
kind in the world. However, severe residue problems
arising from the combustion of Kansk-Achinsk coal in
power station boilers have still not been solved, nor
have suitable boilers yet been produced, which will
inhibit the use of the coal even for regional electricity
generation.
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Furthermore, as noted above, construction of the
2,200- to 2,400-kV DC long-distance powerline re-
quired to transmit electrical energy from Kansk-
Achinsk to the Center depends upon prior successful
experience with the 1,500-kV DC Ekibastuz-Center
line. Construction of that line was scheduled to begin
in 1978, although this starting date may not have been
met. According to the head of the construction
administration building the line, the work will be done
in four sections: the first will be completed in 1984, and
the last three by 1987. At this rate it is highly unlikely
that construction of the Kansk-Achinsk - Center line
could get under way during the 12th Five-Year Plan
(1986-90) even if the technical problems proved
soluble. It is probable that the leadtimes on slurry
transport, pyrolysis or coal liquefaction are at least as
X1 long if not longer.)
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The openendedness of coal policy was indicated most
graphically, perhaps, in a 25 August 1978 Pravda
article. The article questioned the accepted wisdom
that Kuzbass coal was mainly for coking purposes and
that it could not compete in cost terms with Kansk-
Achinsk coal as a boiler fuel. While Kansk-Achinsk
coal was certainly cheaper when burned at power
plants in Siberia and converted into electrical energy,
there was a growing shortage of hard fuel as well as
electrical power in the European USSR. To meet this
need, two-thirds of Kuzbass coal could be used for
noncoking purposes. A special railway could be built
from the Kuzbass through the southern Urals to the
Volga region to carry this coal. Alternatively, a slurry
pipeline could be built. Kansk-Achinsk coal would then
be used strictly as a fuel for thermal power stations,
both in the Kuzbass and central Siberia, providing the
basis for an expanded development in these regions of
energy-intensive industry. In contrast to the views of
some top energy policy advisers such as Kirillin or
Mel'nikov, who probably had considerable influence
on the line approved by the 25th Party Congress and
expressed in the 10th Five-Year Plan, Kansk-Achinsk
was assigned no role at all as a direct supplier of fuel or
electrical energy to the European USSR. The point,
again, as in the case of the gas-fired power station
proposal, is that such a fundamental issue could hardly
be raised if there existed a firm official position on
where energy production policy was going.
V. Prospects
The change of direction on energy policy that occurred
at the December 1977 Plenum of the Central Commit-
tee and the subsequent campaign to accelerate oil
development in Tyumen signal the extreme difficulty
the Soviets are having in sustaining a balanced
response to long-term energy development needs and
short-term demands for petroleum. Since 1976 there
has been a definite foreshortening of the energy
horizon. At the moment, the Soviets are fighting to
maintain West Siberian oil output by increasing
drilling and recovery efforts at Samotlor and other
older Tyumen deposits, and to raise the level of output
by opening up smaller Tyumen fields.
At the outset of the current five-year plan the
leadership apparently opted to develop fewer small
fields in Tyumen and to compensate for this by more
intensive exploitation of Samotlor, despite the greater
field damage and steeper ultimate dropoff in produc-
tion this would entail. Clearly, the leadership already
in 1976 felt compelled to sacrifice the longer run goal
of a relative stabilization of Samotlor production,
either in order to buy time or simply to get the oil
without having to pay increased costs associated with
more rapid small field development. Soviet officials
made the decision with full knowledge that no new
giant oilfield to replace Samotlor had been discov-
ered-much less developed. The consequences of this
short-run approach to Tyumen oil production were
intensified by failure in 1977 to develop even the
planned number of new fields. Payment for this
trade-off will come due in the 11th Five-Year Plan
(1981-85), when greater investment will have to be
made both in developing more new fields than might
otherwise have been necessary, and in providing as
lift and other recovery equipment for Samotlor. as
Meanwhile, the inability of the Soviet leadership over
the past decade to force a technological breakthrough
in even one type of east-west energy transportation
seriously jeopardizes any possibility of large-scale
substitution of gas or coal for oil in the 1980s.
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The race against time now under way to develop and
transport Urengoy gas by conventional pipelines will
probably not have a large impact on the overall fuel-
energy balance, although it may significantly affect
the local energy balance in the Urals. Whether Soviet
R&D organizations will be able to solve the problems
of chilled or liquefied gas transportation in time to
have an effect in the coming decade is highly prob-
lematic. It may well be that the Soviets have already
delayed too long for gas to play the role it otherwise
might have in bridging the gap between the present
and the anticipated era of abundant nuclear energy.
Similar conclusions are in order with respect to Kansk-
Achinsk coal. Delays in mine construction, in solving
the high-voltage DC transmission problem, in develop-
ing either slurry or capsule pipelines, in implementing
any one of the coal processing techniques, and in
producing power-generating equipment adapted to
Kansk-Achinsk coal now push a possible "coal alterna-
tive" well off into the 1990s.
These delays are probably now being seriously exacer-
bated by the Tyumen oil campaign.
Tyumen until the mid- or late 1980s instead of early in
the decade. Although this complaint reflects the views
and interests of the Tyumen gas administration, its
substance may well be correct.
expression of conflicting opinions. It is highly likely
that some top officials, including Premier Kosygin and
Gosplan Chairman Baybakov, would prefer a policy
formula that provided more scope for coal and nuclear
power. And other authorities, with a Tyumen orienta-
tion, are clearly attempting to have an even greater
role assigned to natural gas.
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Given this fluidity in the party line, it is not surprising
that there has never existed what could properly be
called a comprehensive and operative energy program.
To be sure, there are various studies and recommenda-
tions; there are many R&D projects; and there are
compilations of one-year and five-year plan targets,
which may partly be influenced by an image of a
distant desired energy balance. Such images
unquestionably do exist in the minds of top Soviet
economic policymakers and energy advisers. But the
evidence strongly indicates that the process of energy
production decisionmaking has not been seriously
influenced by any carefully elaborated and stable 25X1
master scheme. Instead, the system is driven by
immediate supply needs and input constraints.
Typically, there seems to be a cycle in which studies
and recommendations precede a policy shift; the policy
shift generates efforts to formulate an integrated
program; but this program formulation is quickly
overtaken by changing demands that evoke
counterrecommendations and a switch once again in
the policy line. The absence of an operative master
energy program is matched by the absence of opera-
tive, long-term, integrated programs for key energy
production sectors. Repeated complaints by local
authorities suggest there have been no such programs
for oil development in Tyumen, for development of
Urengoy gas, or for development of Kansk-Achinsk.
Nor has there been an effective program for offshore
oil, although creation of the new Main Administration
for Exploration and Development of Offshore Oil and
Gas Fields in August 1978 may have improved matters
here. When we ponder what "the Soviets" intend to do
five or 10 years from now in some area of energy
production, we may overestimate both the extent to
which an intention has firmly crystallized and the
extent to which an intention, even if formulated,
Despite the grave problem that confronts the Soviets in
energy production, there has been almost a decade of
policy vacillation and indecision. From a faith that the
share of oil and gas in the energy balance would
continue to rise, Soviet authorities moved in the early
1970s to the hope that a big leap in gas production
alone might prove to be the answer; by 1975-76 a
broadly based strategy keyed to oil and gas in the
present, coal in the middle term, and nuclear power in
the longer term was approved as the party line; and by
late 1977, policy had shifted to embrace a campaign
that put the main emphasis on development of oil and
gas production over the next decade. However, the
adoption of the most recent line has not stilled the
affects current decisions.
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The effective absence of program-determined
decisionmaking is to some extent a product of the
inherently greater-and probably still increasing-
degree of uncertainty characteristic of the energy
sector compared with other branches of the economy.
Information about reserves is subject to change and is
imprecise at best. Long leadtimes are a feature of
development in all energy branches. And the cost, time
framework, and feasibility of technological innovation
in such areas as deep drilling, offshore exploration and
extraction, gas transportation, coal treatment, and
high-voltage electrical transmission are openended.
Equally important, though, has been the impossibility
of isolating the energy sector, despite its high priority,
from all the general problems that afflict the Soviet
economy. In the absence of a serious economic reform,
the inevitable disjunction between goals and "success
indicators" produces the same short-term perspective,
anti-innovative bias, and irrational behavior in energy
found elsewhere in the economy. This is a factor that
should not be underestimated. Development in the
energy sector is also immediately linked with success
or failure in many other key sectors of the economy,
including metallurgy, machine building, chemicals,
construction, and transportation, where persistent
bottlenecks have likewise arisen from systemic fea-
tures of the economy. In other words, the complex
linkages between the energy and other sectors of the
economy significantly reduce the capacity of the
leadership to achieve any rapid improvement across a
broad front in energy through the application of
X1 traditional techniques of political mobilization.
The absence of effective programs is a direct conse-
quence, too, of the complexity of the issues involved
and the division of opinion among specialists as to how
they should be solved. Top policymakers are especially
dependent on the advice of specialists in the energy
field; it is an area in which few of them have had
experience and in which intuition or common sense
cannot take one very far. Yet, as we have seen, the
specialists, guided by personal aims and vested institu-
X1
tional interests, tender conflicting advice.
At the juncture between policymakers and advisers
there appears to be no single point at which conflicting
advice is analyzed and firm choices made: the Presid-
ium of the Council of Ministers, Gosplan, and the
Secretariat are each involved. This pattern reflects the
division of labor and balance of power at the top of the
Soviet system. Divided opinions among both the
leadership and energy authorities, combined with the
fragmented structure of power and preference for a
consensual style of decisionmaking, have usually
encouraged compromise policy outcomes determined
by the lowest common denominator-although the
December Plenum of 1977 does reveal a capacity to
effect sudden shifts in policy if the situation is deemed
sufficiently grave. On the whole, despite increasing
anxiety over the energy problem since the early 1970s,
the system in which policymakers operate has
dampened and delayed a decisive response to the
problem, while stimulating the de facto pursuit of
short-term aims.
Without a significant increase in the share of invest-
ment going to energy production and related branches
of the economy (for example, steel), it is difficult to see
how the Soviets can do much to remedy the dilemma
that now confronts them. In this respect, they have less
freedom of maneuver today than they had in the early-
to-mid-1970s. They must make an increasingly heavy
commitment of resources to oil production in Tyumen
because they must have the oil; without the allocation
of additional investment to the energy sector as a
whole, progress toward either a gas- or coal-based
solution to the energy problem will be retarded; and
delay in developing these alternatives will generate still
more pressure to maintain the existing proportion of oil
in the energy balance-despite the day of reckoning
that must come unless a new supergiant oil region is
quickly discovered. Brezhnev's speech at the Novem-
ber 1978 Plenum of the Central Committee suggests
that energy-related investment may indeed be given a
higher priority during the remaining years of the
present five-year plan. Because the physical resource
demands of energy production fall heavily upon the
heavy industrial, construction, and transportation sec-
tors, pressures may mount to make compensatory
cutbacks not only in the buffer sectors of agriculture,
housing, and light industry, but in military production
as well.
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As the Soviets struggle with this problem, grudgingly
increasing the share of investment in energy, they are
likely to try to revive what we have called the Big Gas
strategy. Provided the extent of gas reserves is
anything like official claims, a quantum leap in the use
of Tyumen natural gas would be the only way a really
rapid increase in fuel production could be brought
about. This approach, however, would place an acute
strain on the steel industry and gas and oil machine
building. Foreign supply of credits, large-diameter
pipes, and compressors might well prove to be even
more critical at that juncture than at present.
The Combined Resources strategy propounded by
Kosygin and Baybakov at the outset of the current five-
year plan, with its stress on nuclear power, coal, and
hydroelectricity, was presented in almost so many
words as the Soviet "Project Independence." The
retreat from this strategy in December 1977,
midstream in the plan period, may have compromised
the objective of avoiding external structural vulner-
ability in energy matters. By playing down the policy
commitment to coal and nuclear power, perhaps to
avoid cuts in military or agricultural spending, Brezh-
nev has implicitly increased the already urgent Soviet
need for a broad range of Western onshore and
offshore oil and gas technology. A decision to shift in
the direction of a Big Gas strategy, as noted above,
might well accentuate this potential technological
dependence.
More important, any slackening in the expansion of
coal production and nuclear generating capacity that
might arise as a byproduct of the current strategy
threatens to leave the Soviet Union in the latter 1980s
and in the 1990s with an extremely tight energy
situation, if not a serious energy deficit. It is apparently
this forbidding prospect of a deficit, not the question of
dependence on Western technology acquisition, that
has most disturbed Kosygin. If the present strategy
continues to be pursued, and development of coal and
nuclear power is not accelerated, Soviet energy inde-
pendence will hinge even more than now on either the
chance factor of major new oil discoveries, or a big leap
in gas production and transportation; without one or
the other, faster exploitation of current oil reserves will
simply hasten an energy crisis of drastic proportions,
with all the attendant problems for Soviet foreign
policy.
It would not be unreasonable to suppose that the Soviet
leadership might search for an organizational solution
to its energy production dilemmas; this has been a
typical response to analogous problems in the past. As
we have seen, it appears that neither the Politburo nor
the Secretariat has to date provided the kind of
supervision and day-to-day control over energy produc-
tion of which it is capable. We might expect to see the
formation of a Politburo-level committee responsible
for monitoring energy problems, which would bring
together an upper stratum composed of Politburo
members (for example, the General Secretary, the
senior secretary for economic affairs, and the Chair-
man of the Council of Ministers) and a lower stratum
composed of key administrators (perhaps the Central
Committee secretary responsible for heavy industry,
the deputy chairman of the Council of Ministers for
energy, the deputy chairman for fuel-energy affairs,
the deputy chairman for science, and the chairman of
Gosplan). Conceivably such a grouping might come
together as a committee or subcommittee of a commit-
tee with a mandate extending beyond energy questions.
A more visible change that might be anticipated would
be the appointment of a Central Committee secretar
responsible solely for energy affairs.
Neither change would significantly alter the present
situation. There would still be the same conflicting
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claims of the different energy branches and the same
hard choice between the claims of energy and other
sectors of the economy. There would still be divided
opinion on which course to follow. And there would
still be a diffusion of power and responsibility at the
top. Although the appointment of an energy secretary
would swing initiative toward the Secretariat, it would
not produce an "energy tsar" unless the jurisdiction of
such a post was extended to all the sectors of the
economy that support energy. Such an innovation
would mean a radical restructuring of the entire
present system of top-level economic administration,
and probably could be pushed through only under a
leader even stronger than Brezhnev.
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 The coming leadership succession is unlikely to thrust
such an individual forward, at least for a number of
years. A succession period probably will permit an
easier reconsideration of the present policy than would
be possible if Brezhnev were still around, because of
Brezhnev's strong public association with it. The
possibility of a shift in the line during the succession
cannot be discounted, especially if the "Tyumen
acceleration" founders. A sharp change of direction
was initiated in agriculture, industrial organization,
and party management soon after Khrushchev's depar-
ture, before the power struggle had been settled.
Where an earlier policy has clearly failed, there is no
necessary paralysis in a succession setting. A speedup
in gas production, for example, might well occur.
However, there will probably not be a consensus
supporting a particular solution to the energy produc-
tion problem. The likelihood is that succession condi-
tions will simply reinforce the present tendency
toward compromise policy solutions and short-term
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expediency.
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Appendix
Alternative Strategies for
Dealing With the Energy Problem
The Hydrocarbon Alternative
Strategy
One answer to the energy problem-the answer
currently in vogue-is to maintain the policy pursued
since the 1950s of priority development of hydrocar-
bons: simply accelerate the output of oil and gas: This
solution, in effect, calls for a concentration of resources
on Tyumen Oblast where most of the presently
explored large reserves of oil and gas are located,
although it also points to an intensification of petro-
leum and gas exploration and development farther east
in Siberia. As an element of this strategy, it is urged
that Tyumen be developed as a truly integrated
"territorial production complex," with the optimal
balance of complementary industry and adequate
provision of infrastructure wherever necessary in this
enormous swampy, permafrost-ridden region. There
should be maximum exploitation of all of Tyumen's
hydrocarbon resources through a large-scale buildup
in Tyumen of the refining, petrochemical, and chemi-
cal industries.
Proponents and Opponents
Most of the main proponents of this strategy, not
surprisingly, are people who have played a personal
role in developing Tyumen Oblast, which is not to say,
of course, that all people who have been active in this
region support the strategy. Boris Shcherbina, Minis-
ter of Construction of Petroleum and Gas Industry
Enterprises since 1973, is the most prominent visible
Tyumen booster. As party first secretary in Tyumen
during the transformation of West Siberia into the
Soviet Union's most important oil- and gas-producing
region in the second half of the 1960s and early 1970s,
Shcherbina lobbied vigorously for a broad pattern of
Tyumen development, and he has continued to do so in
his present job. He has been joined by his protege and
successor as obkom first secretary, Gennadiy
Bogomyakov, a native West Siberian, and by a
younger client, the present obkom second secretary
and former Tyumen Komsomol official, Gennadiy
Shmal'. The most outspoken champion of the Tyumen
cause is still another client of Shcherbina: the hot-
tempered Azerbaidzhani, who discovered many of the
big deposits in Tyumen and who is at present head of
the Tyumen Geological Administration, Farman
Salmanov.
Apart from the Tyumen grouping, the most vocal
supporter of Tyumen and East Siberian oil and gas
development has been Academician Andrey Trofimuk,
director of the Institute of Geology and Geophysics of
the Siberian Division of the Academy of Sciences and
member of the Presidium of the all-union Academy of
Sciences. Other Tyumen supporters have included the
chairman of Gosplan's Council for the Study of
Production Forces, Nikolay Nekrasov, and Russian
nationalist circles associated with the literary journal
Oktyabr'.' Almost certainly the Hydrocarbon alterna-
tive represented by Tyumen development has also
found some support over the years in the Central
Committee apparatus, although we have no evidence
precisely where. The most likely candidates are
Dolgikh and perhaps Kirilenko, although Brezhnev
himself may well have had some interest in the matter
before espousing the cause in December 1977.2 I
Two points should be noted about the supporters of the
Hydrocarbon alternative. First, with the exception of
members of the Secretariat, whose backing prior to
December 1977 is largely a matter of conjecture, the
pro-Tyumen forces have been mostly provincial in
their geographical base and limited to the exertion of
influence rather than operational command in promot-
ing Tyumen development. Secondly, like the support-
ers of other alternatives, their position has to no small
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Gosplan Chairman Baybakov (dark glasses)
and the late Minister of Oil Shashin inspect
a Tyumen oiUeld
extent tended to be directly related to immediate
personal interests. For example, Shcherbina's ambition
to become the deputy chairman of the Council of
Ministers responsible for fuel-energy affairs turns in
part upon making a record for himself in construction
work and pipeline-laying in Tyumen; Bogomyakov and
Shmal' have a direct stake in getting more investment
and resources for their oblast; Salmanov's sense of
personal identity is clearly linked to further oil and gas
discoveries in Tyumen; and Trofimuk's professional
standing rests on proving that Siberia does indeed have
the oil and gas resources he has long claimed it has.
These personal career interests should not be confused
with regional loyalty, althou h an element of this too is
certainly present
Opponents of the West Siberian Hydrocarbon alterna-
tive have always been harder to identify than pro-
ponents, but there is no doubt they have existed. The
main source of resistance to a root-and-branch com-
mitment of resources to Tyumen appears to have been
Gosplan Chairman Baybakov and elements within
Gosplan who have taken their cue from him.'
Baybakov is well aware that Tyumen is critical for
Soviet energy development; he has probably spent
more time thinking about this than any other top
Soviet leader and has actively sought ways to harness
Tyumen resources. The issue for him has almost
certainly been one of degree; a matter of balancing
Tyumen investment against other claims on resources.
Basically, Baybakov has been concerned about the
staggering costs of Tyumen energy development and
transportation because it is he who has had to find the
funds to meet Tyumen's needs and who has had to take
much of the heat for cutting back other programs.
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Valentin Shashin C
Minister of Oil until his death in 1977
Baybakov's counsel on energy production policy is
probably carefully heeded within top leadership
circles. He is said to be on good terms with at least
Kosygin, Mazurov (now retired), and Dolgikh, and to
have played an instrumental role in aiding Brezhnev's
rise to power. He also has close working relationships
with the Academy of Sciences and the State Commit-
tee for Science and Technology, including strong
influence with Mel'nikov, at least a cooperative tie
with Styrikovich and Aleksandrov, and a collaborative
relationship with Paton. Having personally worked in
and headed the Soviet oil industry for many years, and
then having dealt with the details of all energy
production branches as Chairman of Gosplan,
Baybakov can legitimately claim great familiarity with
energy policy issues. He is also one of the few
individuals who tells the Politburo what the tradeoffs
are in investment decisions.
Premier Kosygin's attitude toward the Hydrocarbon
alternative has probably also been one of reserve. What
evidence there is suggests that his main concerns have
been to effect a substitution of coal or gas for oil,
stimulate nuclear power, hold down hard currency
imports (he has specifically complained about the cost
of large-diameter pipe) and in general raise efficiency
and lower costs in energy production. He has not been
"against" West Siberia; rather, he appears to have
been interested in moving in new directions in order to
reduce the dependence on oil. 25X1
The late Minister of Oil Valentin Shashin, who died in
1977, was probably another doubter of the Tyumen-
based Hydrocarbon solution to the energy problem.
Shashin's position appears to have been that oil was a
precious nonrenewable resource that should be pre-
served as much as possible for future generations and
that this circumstance ought to be reflected in the
energy balance, the pricing of oil, and export policy.
Back in 1969 Shashin stated at a press conference that
Soviet oil exports would not increase significantly due
to domestic requirements, and he reiterated this stand
in 1974. Shashin's preferred go-slow oil policy was
probably sincere, but it also reflected the interest of
Shashin and his ministry in having realistic production
targets for a region that presented them with a host of
extremely difficult problems. 25X1
Disagreement in principle with the Hydrocarbon
solution has probably been expressed most forcefully in
scientific circles that question the reserve base of West
Siberia-a topic treated below. Other energy-produc-
ing regions whose interests may be affected by the
allocation of investment funds and scarce resources to
Tyumen have constantly tried to defend themselves by
arguing how high the returns are on investment in their
particular region, although they rarely complain about
Tyumen in public. There are also ministries whose
capacity to fulfill plans and meet obligations elsewhere
in the country are endangered by the voracious
requirements of Tyumen, and who are thus probably
not enthusiastic about overly ambitious plans for the
region (for example, in the fields of electric power,
construction, and transportation).
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Issues
Tyumen may be the "discovery of the century," as the
Soviet slogan claims, but its development has pre-
sented enormous problems and gives rise to a number
of fundamental issues. The most crucial issue at
present is how much oil is left in the region. This is not
a new issue; at every stage of Tyumen's development
there have been skeptics who have questioned the size
of the re ion's oil resources- d this is equally true
today."
Since the consolidation of the giant oil-producing
region on the Middle Ob in the second half of the
1960s, the key issue has become whether the rapid rate
of increase in oil output achieved during 1971-75 can
be sustained-and this depends on how much oil can
be extracted from new small deposits already discov-
ered-and whether there will be future discoveries of
huge new oilfields of the magnitude of Samotlor. Those
who have taken a very bullish stance on this question
over a number of years include Minister of Construc-
tion of Petroleum and Gas Industry Enterprises
Shcherbina; Tyumen first secretary, Bogomyakov;
Tyumen chief geologist, Salmanov; Academician
Trofimuk; and a number of other party officials and
geologists. Some foresaw Tyumen oil production at
1 billion tons a year. Their argument has been that
giant deposits can and unquestionably will be found at
deeper levels in the Middle Ob region already being
exploited, and-especially-beneath the huge gas
deposits of northern Tyumen, as well as still farther
north on the Yamal Peninsula and beneath the Kara
Sea (see map). The faith that oil will be found in these
areas is based partly upon controversial geological
theories and partly upon discoveries in northern
Tyumen of what some say are traces of oil, but others
say are simply findings of gas condensate.'
In 1976 the debate over whether large reserves of oil
exist in Tyumen sharpened, as belated decisions had to
be made on the 10th Five-Year Plan (1976-80). In a
polemical article published by Pravda on 19 February
1976, Salmanov argumentatively asserted that au-
thoritative calculations showed that "there are possi-
bilities in this region for the reliable and mighty
development of the oil and gas industry." (Emphasis
added) However:
"Pessimists" have appeared whose thoughts
amount to the proposition that the Tyumen
geologists have already discovered everything that
could be discovered. Such judgments are thor-
oughly false. To adopt this point of view means to
disorient the planning organs. With all responsi-
bility I must observe that the Tyumen geologists
are firmly convinced of the reliability of the
evaluation of resources of oil and gas in our
region.
According to Salmanov, oil was to be found on the
Yamal Peninsula, in the Pur-Taz region (which
includes Urengoy), and in the western and central
areas of the Middle Ob. A month earlier Salmanov and
the geologist Nesterov had complained that skepticism
over Tyumen oil reserves was sufficiently great that
"proposals have already appeared to provide as fuel for
the Tobol'sk petrochemical combine [one of the larger
industrial projects of the five-year plan] not [associ-
ated] gas from the Middle Ob deposits, but coal from
the Kansk-Achinsk Basin."6
Later in 1976 the Tyumen party first secretary,
Bogomyakov, critically commented that because the
oil resources had not actually been pinned down by
detailed geological exploration:
Right away there appear many skeptics, doubters
and semidoubters, and absurd figures arise....
but our calculations, the calculations of geological
organizations, the needs of the country and the
possibilities of the region itself convincingly dem-
onstrate that one must not "shut off" the perspec-
tives of the Tyumen complex at 1980, or indeed
imagine that in 1980 we will increase extraction
by 30-33 million tons, but in 1981 [just] by 5
million tons. What all this means is that it is
necessary to fully expand geological work so that
a high growth can be provided in the 1980s and
1990S.1 1
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USSR: West Siberian Basin Oil and Gas Development
ar'yan-Mar
~A~ctic C
Wst'-Usa
- nta
,,Pechora
ti Nizhniy
Chelyabinsk
ustanay
Nadyml
uhll jn55
Suhkin
Oudink Noril'sk
Soleninsk
rlessoyakha
lgarka
oy
}Urengoy
It l
Achinsk
Anzhero-Sudzhensk J
a Kemerovo
YAMAL
Bovanenkov
Ust'-Balyk 7'q 12
l ye-^+--~. .u
Shem Mansiysk "P~?l4'~ '~-nllegion
f 11. ilina ktamo toll sovet4
Oilfields
Q major producing c-' selected new
field small field
Oil pipelines
-=multiple -single
Major gasfields
00 producing undeveloped
Gas pipelines
multiple --single
----a-r- Railroad
300 kilometers
0 300 miles
1. Busskoye
2. kholmagorsk
3. Severs-Var'yegan
4. Var'-YeOen
5. Povkhavsk
a. Pokachevsk
7. Savuysk
6. Yuzhno-Surgut
9. Pskomatovsk
10. Lokoaov
11. Severo-Pokursk
12. Ur'yev
13. Vakh
14. Yuzhno-Balyk
15. 62alohalyk
16. Teplovsk
17. Salym
16. Verkhneshapshinsk
19. Verkhnesalym
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Bogomyakov's argument was echoed in similar pro-
nouncements that appeared during 1976 and 1977 in
the press and technical journals.' In an article written
for the literary journal Oktyabr' (1977, No. 11), the
director of the West Siberian Oil Geology Institute,
Nesterov, clearly suggested continuity between the old
dispute over the presence of oil in Tyumen and the new
dispute over the possibility of further giant discoveries.
of smaller fields for exploitation in the next five-year
plan period. In an article that appeared between the
December publication of the draft version of Basic
Directions of the Economy of the USSR for the Years
1976-1980-the Politburo's strategy for the 10th Five-
Year Plan-and its confirmation at the 25th Party
Congress in March 1976, Muravlenko set out the scale
of work that would have to be performed to fulfill the
plan and a whole set of conditions that would have to
be met if-it was implied-there was to be any hope of
plan fulfillment."
Once again, the skeptics have not been clearly identi-
fied. However, the available evidence indicates a
rather broad spectrum of officials. It seems fairly
certain that doubters have been found amidst the ranks
of Gosplan.' They are found among scientists outside
of Tyumen. They also can be found within the Ministry
of Geology, both in Moscow and in the field in
Tyumen.10 According to Bogomyakov, Erv'e, the chief
of Glavtyumengeologia (the Tyumen Geological Ad-
ministration) for many years and now USSR Deputy
Minister of Geology, has had his moments of doubt,"
which is suggested too by the cautious way Erv'e has.
treated the north Tyumen oil issue." And, finally,
doubters exist within the Ministry of Oil. It is clear
from the late Minister of Oil Shashin's speeches that
he, for one, thought that Tyumen's oil reserves would
soon have to be augmented by equally large discoveries
elsewhere-probably in East Siberia. Shashin's suc-
cessor, Nikolay Mal'tsev, has given no strong public
indication that he thinks the solution to the Soviet oil
problem lies in Tyumen. One of the oldest specialists in
the Ministry, A. P. Krylov, is said to have been opposed
to gambling on a major increase in Tyumen output.
Shashin's views may well have been influenced by the
outlook of his man in charge of Glavtyumenneftegaz
(Main Tyumen Oil Administration), Viktor
Muravlenko.
Muravlenko, a capable and well-informed administra-
tor who died in 1977, had reached a state of extreme
pessimism about oil output prospects in Tyumen by
1976." Already in 1973 he had indicated his alarm
over the failure to discover large new deposits in
Tyumen, to explore the northern area of the Middle
Ob, and especially to look ahead and prepare "dozens"
The question arises: how could such a situation in
which there was so much uncertainty about the
prospects of West Siberia have come about? The
answer is complicated, but reveals much about the
management of Soviet oil resources. It turns partly
upon information about production and reserves, and
partly upon the allocation of resources among compet-
ing oil-producing regions.
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Viktor Muravlenko
Chief of Glavtyumenneftegaz
until his death in 1977
A possibility that should not be ignored is that
production and reserve figures may be significantly
falsified, or at least may be so subject to manipulation
that they could badly mislead top policymakers.
More fundamental still in explaining the uncertainty
surrounding West Siberian prospects is the absence of
sufficient data tending either to prove or to disprove
the hypothesis that new giant oil deposits are located in
Tyumen, or indeed in other prospective regions farther
east in Siberia. The lack of hard evidence pinpointing
reserves has been a source of deep anxiety among
production officials since the early 1970s. By 1972, at
the latest, some specialists were convinced that the
Middle Ob fields of Tyumen would not suffice to meet
Soviet oil needs after 1980.18 In 1973 Minister of
Geology Sidorenko, who was shunted into the Acad-
emy of Sciences in 1975, pointed out with alarm the
impact of current and anticipated rates of oil extrac-
tion on oil reserves, and proclaimed, "We need [read,
do not have] general programs to prepare for the
exploration of large prospective regions-the North
and Polar Urals, Kareliya, the K z lkums the Sibe-
rian Platform, and others."" 25X1
At a big meeting on geological prospecting in Tyumen
held in November 1973 and attended by Party
Secretary Dolgikh, Gosplan Deputy Chairman
Lalayants, Minister of Oil Shashin, RSFSR Minister
of Geology Rovnin, and Academicians Styrikovich and
Trofimuk, the then obkom first secretary, Shcherbina,
criticized the geologists for their "weak tempos of work
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in new, highly prospective regions in the north of the
oblast."20 A few month later Shashin declared:
The present high level of oil extraction and
maintenance of the achieved levels of growth
cannot be provided for by discoveries of the
previous period. The discovery of new deposits in
the existing oil extracting regions, even of very
large ones, can only compensate for the decline of
extraction in old deposits, support the achieved
high level of extraction and in the best of cases
provide for a certain insubstantial growth. There-
fore, there arises now as never before the question
of the of the need to discover new enormous
[krupneishie] oil-bearing provinces equal to the
Urals-Volga and West Siberia. East Siberia, the
Caspian Depression, and the shelves of seas and
oceans, which have enormous potential possibili-
ties for the growth of reserves, may be such
regions. But at the present time we are alarmed by
the fact that the Ministry of Geology of the USSR
is drilling an insufficient volume of exploratory
wells in new prospective provinces."
And a meeting was called by the Ministry of Geology
in September 1974 specifically to discuss the urgent
need to create a new oil base in East Siberia."
The level of concern has not receded in the more recent
period. Deputy Minister of Oil N. S. Yerofeyev, made
the timetable more specific in 1976: "In order to create
a reliable base for the further development of the oil
industry it is necessary already in the 10th Five-Year
Plan [that is, before 1981 ] to discover and begin to
develop a new petroleum province equal to the Urals-
Volga or West Siberia."23 Yet at a huge all-union
geological meeting held in Tashkent in October 1976,
at which it was acknowledged that "further high
tempos of development of the extraction of oil and gas
in the country to a considerable extent depend upon the
discovery of new large deposits of oil and gas," it
became apparent that the relevant institutes had not
yet even begun to "give a scientific rationale for the
most optimal directions of geological exploratory
work" in East Siberia, north Tyumen, the north-
eastern. part of the European USSR, the Caspian
Depression, or offshore.24 And in a 1978 article
Academician Trofimuk was moved to inform his
audience that the West Siberian oil reserve situation
should not be considered "fatal."25
One reason that so-called predicted reserves have not
become proven reserves in Tyumen is that geological
prospecting in the region stagnated between 1968 and
1975. During the Ninth Five-Year Plan (1971-75),
Glavtyumengeologiya fulfilled its plan for deep
prospecting-exploratory drilling by only 92 percent,
and overfulfilled its plan for growth of reserves of "oil
and condensate" by progressively less each year. (The
plan indicators, by lumping oil and condensate to-
gether, may well have concealed underfulfillment of
the target for growth of oil reserves from 1973 on.)
This lag caught up with the geologists in 1976 and
1977, when the plan for growth of reserves in Tyumen
was not met.
There are technical reasons for this lag. Geologists
have been hard put to prepare sufficient areas for test
drilling. Soviet geophysical methods have been in-
adequate for finding potential oil-bearing strata at the
deeper depths at which geologists such as Salmanov,
Trofimuk, and Nesterov say they are to be found.
Seismic equipment has not been up to world standards,
and major limitations have been imposed by deficien-
cies in Soviet computer hardware and software.
Serious problems have also been associated with the
deep drilling needed to explore for oil and gas: industry
has not produced the transportable rigs, drill bits,
drilling pipe, and other high-grade equipment needed
by geologists. Transportation under Tyumen condi-
tions has been another enormous bottleneck.
Almost as important as these technical factors re-
straining the sort of exploration deemed to be neces-
sary, however, has been the impact of the incentive
system for rewarding geologists. The "indicator"
problems of linking work performed and final results,
which are common to any sphere of Soviet economic
activity, are here compounded by the difficulty of
determining at the completion of a plan period the
effectiveness of an activity the true worth of which can
only be known after the passage of time.26 Glav-
tyumengeologiya has had a strong material incentive
to tolerate the locational pattern of exploration that
has tended to emerge from these success indicators
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Swamp transportation in Samotlor
and construction ofa winter road
because its success has been measured by the aggre-
gate total results for the oblast as a whole, rather than
by an indicator sensitive to a geographical pattern of
drilling that would promote a long-term growth in
A still more important factor behind the lag in reserves
than either equipment deficiencies or incentive systems
has been the constant pressure from Moscow for higher
and higher immediate oil production. This pressure
led, from 1969 through at least 1975, to a heavy
concentration of all Tyumen geological prospecting
resources-both those of the Ministry of Geology and
those of the Ministry of Oil-on the Middle Ob region.
Like the counterproductive incentive problem, the
inability to sustain a systematic progression from
comprehensive geophysical studies of broad regions, to
the establishment of a fund of promising sites for deep
drilling, to adequate proving of reserves is rooted in the
nature of the Soviet economic system. The pressure
from above for immediate output was reflected, for
instance, in the allocation to the Middle Ob region
during the Ninth Five-Year Plan of 14 out of 21
seismic exploration groups, in the fact that 72 percent
of deep exploratory drilling was done in the Middle Ob,
and in the fact that northern oil exploration expedi-
tions were more poorly equipped than those on the
Middle Ob.
A bureaucratic power stuggle in this instance intensi-
fied what was basically a result of planners' prefer-
ences. The fundamental interest of the Ministry of Oil,
represented by Glavtyumenneftegaz, has been and still
is to produce slightly more oil each year than called for
by the plan. It has not been significantly rewarded for
increasing the stock of oil reserves. Thus, it has been
motivated to shift rigs and crews from exploration to
production drilling. Because it is politically a far
weightier actor than the Ministry of Geology, it has
also apparently managed to get more than its share of
drilling rigs and equipment out of Gosplan, at the
expense of Glavtyumengeologiya. When the Ministry
of Oil has argued that its piece of the pie must be larger
or the critical yearly oil output plan would not be
fulfilled, Gosplan has had that much more reason to
listen.
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Finally, and most important, geological exploration in
Tyumen has been significantly retarded by the deliber-
ate choice of Soviet policymakers. A key article
published in Pravda on 10 August 1977 revealed that:
? The Ministry of Geology and Gosplan, beginning in
1968, made yearly reductions in budgetary and mate-
rial allocations to Glavtyumengeologiya.
? Specialized geological exploration drilling trusts had
been liquidated in the Ob region and the Yamal
Peninsula.
? In the past decade, oil extraction had grown 40 times
over, whereas exploratory drilling had "remained at
the old level."
? In 1973 the RSFSR Ministry of Geology had taken a
special decision forbidding any further search for gas
in Tyumen Oblast, "considering that the already
explored reserves were sufficient for many years."
? The reequipping of geological exploratory parties
had de facto been stopped.
I- I
According to Salmanov, currently chief of
Glavtyumengeologiya, the absolute level of capital
construction planned for his administration in 1976
was lower than the level of 1966. Salmanov and other
Tyumen-leaning geologists have repeatedly com-
plained of gross discrimination against Tyumen in
resource allocation. In their view, much too heavy an
investment of resources is being made where the
potential payoff is far less than it would be in
Tyumen-namely, in the Urals-Volga fields.27 Their
resentful attitude toward Gosplan is hardly con-
cealed."
As we have already seen, Gosplan has been inclined to
treat skeptically claims of potential new supergiant
fields waiting to be discovered in Tyumen Oblast. But
it has been accused also-perhaps justly-of harbor-
ing unrealistically high expectations concerning the
capacity of Tyumen's proven reserves and of those
Tyumen fields already in production, especially
Samotlor. In a hard-hitting article written during the
period in which fundamental decisions were being
made on the five-year plan for 1976-80, by A. Murzin,
one of Pravda's two outspoken West Siberian corre-
spondents, Gosplan was accused of failing to look
ahead to what would happen after Samotlor peaked "in
two years," complacency over Tyumen's production
capacity, premature exhaustion of Samotlor through
virtually criminally high output targets, and, in gen-
eral, ignorance of the need for a rapid, comprehensive,
and integral development of the smaller deposits in the
Middle Ob.29 "Overconfidence" and self-deception
may partly explain Gosplan's attitude, but probably
more stress should be placed upon a harried weighing
of cost factors within the Presidium of the Council of
Ministers as well as Gosplan, which has affected not
only allocations for geological exploration and develop-
ment in Tyumen, but the general allocation of re-
sources between West Siberia and the older oil-
producing regions.
Developments
It should be apparent that despite the high priority
assigned to West Siberian oil and gas development,
Tyumen did not get everything it wanted or needed
during the years 1971-75. Undersatisfaction of
Tyumen demands was, indeed, one of the principles of
the Ninth Five-Year Plan. At the November 1971
Supreme Soviet session that approved the Ninth Five-
Year Plan Kosygin declared, "Along with further
development of exploration work in the eastern re-
gions, geologists must strengthen the search for oil,
coal, gas, and other useful minerals in the European
part of the country." And the plan itself stated, "In the
Ninth Five-Year Plan geological prospecting work will
be considerably strengthened overall for the country,
and especially on the territory of the n part of
the USSR.""
A general restraint on resource allocations to Tyumen
seems to have appeared imperative to Moscow because
of the extremely high costs of Tyumen infrastructure
development, the serious problems involved in trans-
porting Tyumen oil and gas to consumers in the
European USSR, and the competing claims of various
large projects incorporated in the plan for 1971-75.
One of the complaints of West Siberians has been that
planners view the development of the region as just one
among other big projects such as the Kama River
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Arrival of an oil-drilling brigade
from the Urals-Volga, typical of
manpower shifts employed by the USSR
Truck Plant, BAM, and Atommash, rather than as an
undertaking of a qualitatively greater magnitude and
duration. As the five-year plan progressed, West
Siberian allocations appear to have become caught up
in the overall slowdown of the economy and the
response to this by the Soviet leadership. At the
Central Committee Plenums in December 1972 and
1973, Brezhnev laid down the line that efficiency
should be one of the major goals of Soviet economic
activity, and this dictum tended to translate itself into
a positive reconsideration of the benefits of investment
in the older, European USSR oil-producing regions.
There has always been a need to strike a balance
between the needs of the old regions and the needs of
Tyumen. Although these regions have now ceased to
make a significant contribution to the growth of Soviet
oil output, they were still contributing over 60 percent
of total production in 1975 and are planned to
contribute over 40 percent in 1980. It has obviously
been critical for the Soviet leadership to avert a
precipitous decline in the older fields, so the question
has been one of precisely where to draw the line
between allocations to the old as against new fields.
Great attractions of the older fields from Moscow's
standpoint have been the existing capital stock, infra-
structure, refinery capacity, and available pool of
skilled labor, not to mention proximity to consumers.
But an equally great temptation to invest more in the
older fields has been the prospect of extracting
significantly more oil from already developed fields.
1 -1
From at least 1970 onward it appears that there have
been major disagreements among Soviet specialists
over what percentage of oil is actually being recovered
from oilfields. Some officials, like the late Minister of
Oil Shashin, have claimed extraordinarily high recov-
ery rates-partly because they may in fact have been
convinced of the efficiency of Soviet water-flooding
techniques, and to no small extent because they must
have perceived the potentiality of the "low recovery"
argument to divert resources to the older producing
regions. At the 24th Party Congress in 1971 the Tatar
obkom first secretary, Fikryat Tabeev, made a big
pitch for intensification and for raising recovery rates,
and Kosygin hinted at his own position on this issue by
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calling for higher recovery in the European oilfields.
The Ninth Five-Year Plan itself included a long
endorsement of enhanced recovery, with the main
stress placed on continued water-flooding and the use
of steam and hot water. This theme was then stressed
by some Gosplan and Oil Ministry officials (for
example, chief of Gosplan's Petroleum and Oil Indus-
try Department, Galonskii, and then Deputy Minister
of Oil Mal'tsev), but not by others (including A. E.
Probst of Gosplan's SOPS or Minister of Oil Shashin
himself).
Soon after the December 1973 Plenum of the Central
Committee, at which Brezhnev appears to have
roundly criticized the Ministry of Oil, the Central
Committee's Ekonomicheshaya gazeta (1974, No. 11)
published a long article entitled "Task of Economic
Importance: How to Improve Utilization of Geological
Reserves of Oil," signed by "Doctor of Technical
Sciences, N. K. Baybakov." In his role of oil expert,
Gosplan Chairman Baybakov presented a detailed
rationale for a major program of enhanced recovery. A
critical factor, Baybakov noted with alarm, was the
rising percentage of oil output going simply to compen-
sate for decline in the older fields: 39 percent in the
Seventh Five-Year Plan, and 64 percent in the Ninth
Five-Year Plan. "In preliminary longer term calcula-
tions," he warned, "the proportion of new wells needed
to compensate for declining extraction will rise to still
greater heights." Production just for compensation was
becoming "a weighty factor that is burdenin the
economy of the branch."
The seriousness of the situation arose in part from low
rates of oil recovery. Despite the historical virtues of
the Soviet water-flooding technique (a politically
charged issue attacked only behind closed doors),
"enormous" quantities of oil were left in wells that had
been shut down, or would be left in wells still being
produced. The moral was clear:
The national economic significance of raising the
recovery of oil is supported by the large economy
of capital investments, material and labor re-
sources. If, for example, one sets the task of
extracting additionally at deposits being worked
in the prospective period (1976-1990) through
raising the recovery rate one billion tons, or
approximately 70 million tons per year [N. B.]
then the economy from realizing this measure
could be evaluated as many hundreds of millions
of rubles of capital investments, a reduction of
material and labor resources.... It is necessary to
keep in mind that increasing recovery by just
1 percent will produce on a countrywide scale
many tens of millions of tons per year of addi-
tional oil at already created capacities with
insignificant capital expenditures and production
costs, which is equivalent to the discovery and
development of not just a small number of large
oil deposits.
This recovery effort, which Baybakov indicated had
Politburo approval, was to be pushed especially hard in
the European USSR (including Azerbaidzhan and the
North Caucasus), where there were "difficulties in
fully supplying the economy with fuel" that necessi-
tated costly imports from West Siberia: "Already at
the present time it is necessary to transport from
eastern regions of the country an ever-increasing
quantity of oil and gas, which demands enormous
capital investments, a great quantity of pipe, machin-
ery for construction of oil and gas trunk pipelines,
pumps and compressor stations, and also large labor
expenditures." The great economies Baybakov visual-
ized were to come from the introduction of a broad
range of artificial lift techniques (submersible pumps
and gas lift) and new enhanced recovery means
including chemical additives, thermal methods, and
open mining. Speaking with an authority that tran-
scended his "doctorate," Baybakov ended by tasking
the Ministry of Oil with preparing a long-term oil-
recovery program.
Baybakov's article was not the last word on recovery,
although in due course a long-term recovery program
was adopted. Differences of opinion over the issue
continued to surface, some directly stimulated by
Baybakov's foray. In a general way, the argument
tended to pit Gosplan, some officials in the Ministry of
Oil (including the present Oil Minister, Mal'tsev), and
regional officials who stood to benefit from the stress
on recovery (especially from the Urals-Volga area and
the Caucasus) against Ministry of Oil officials who
probably thought that "recovery" was an evasion of the
hard investment decisions needed in the forthcoming
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10th Five-Year Plan," some Academy of Sciences
specialists," and production officials who knew that
enhanced recovery efforts worked against their own
financial and career interests under the existing set of
success indicators." The argument that enhanced
recovery best reflected the party line on the need for
greater "efficiency" was countered by the argument
that "efficiency" did not mean counterproductive
slashes in budgetary and material allocations to
Tyumen, but-on the contrary-meant comprehen-
sive, integrated development of the oblast which
minimized the waste that resulted from piecemeal
development and constant half measures. But lines of
disagreement were blurred by the rapid co-option of
"recovery" by Tyumen production leaders, who saw
large gas-lift projects as one of the possible paths out of
the dead end into which they were marching.
materials, and equipment was implicit all along in the
program. Yet cranking up the foreign trade component
has taken more time, perhaps, than Baybakov sus-
pected. It is now over four years since the Soviets began
to talk seriously about recovery, but purchases have
been intermittent and the major West Siberian as-lift
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Meanwhile, the record strongly suggests procrastina-
tion on the broader issue of Tyumen development. In 25
1972-74
it was generally ac-
cepted that it was not economical to develop the small
fields in Tyumen. This judgment was soon overtaken
by a nonevent-the failure to discover a giant new
oilfield in Tyumen. Erosion of the reserve base was
magnified by water encroachment at Samotlor and
other large fields in the Middle Ob. Soon after final
approval of the 10th Five-Year Plan in October 1976, a
decision was taken to accelerate the discovery of
reserves in West Siberia, which generated a crash
program of geological activity in 1977. This campaign
was marked by the usual lack of coordination between
the Ministry of Geology and Ministry of Oil, and did
not resolve the uncertainty over Tyumen oil resources
The "recovery" debate was part of a more general
controversy over whether economically rational cri-
teria (that is, "rational" in intrabranch terms) should
govern allocations of funds, resources, and manpower
to the older fields, or whether the proper policy should
be to maintain the achieved production level in older
regions at any price with infill drilling, development of
small unproductive fields, and enhanced recovery. As
in other areas of controversy focused upon in the
Hydrocarbon solution to the Soviet energy problem,
there was to be no clear resolution of the recovery issue
in the period up to December 1977.
In 1975 a long-term multibranch recovery program
was formally approved, with a parallel research
program in the Academy of Sciences. Implementation
of this program was placed higher than the commis-
sioning of new oilfields on the formal list of priorities
for the oil industry in the 10th Five-Year Plan (1976-
80) approved by the 25th Party Congress in March
1976. However, the program has been undercut by
major delays in implementation, arising partly out of
the disincentives for production personnel to bother
with tertiary recovery, and partly out of the absence of
necessary materials and equipment.
Baybakov's original interest in enhanced recovery was
almost certainly stimulated by US experience (or talk)
in this field, and acquisition of foreign technology,
or offer any immediate alternative other than further
development in the Middle Ob.
Thus, during the struggle over the five-year plan in
1975 and 1976, a stark choice confronted the
policymakers: should a major commitment of re-
sources be made to commissioning rapidly a relatively
large number of small new fields in outlying areas of
the Middle Ob, with very large infrastructure costs, or
should investment in the small deposits be restrained,
Samotlor and other large Middle Ob fields pushed
beyond their planned capacities, and maximum efforts
made to keep up production in the Urals-Volga region?
A second choice, at least in the eyes of Tyumen
supporters, was whether a decision would be taken to
broaden the whole economic profile of the oblast by a
more rapid development of the refining, petrochemical
and chemical industries, and (as discussed below) the
construction of large gas-fired thermal power plants to
supply the Urals and European USSR
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Mounting a high-voltage line
support tower in Tyumen Copyrighted
Tyumen advocates pressed hard on these points during
1975 and 1976, but did not win.34 In the 10th Five-
Year Plan the Soviet leadership tried to prevent a
qualitative leap in the already huge investments being
poured into Tyumen. Consequently-as noted above-
the leadership emphasized recovery and maximum oil
extraction from the depleted European USSR fields. It
talked about developing the small fields in Tyumen,
but did not allocate the resources that were required,
thus putting still more pressure on Samotlor and other
producing Middle Ob fields-in direct contradiction to
the strongest advice it was receiving from Tyumen. In
fact, it even assigned "supplementary" oil production
targets to Tyumen over and above those already set by
the plan for 1976. It did make a major commitment to
development of the petrochemical base of West Siberia
by including the Tobol'sk and Tomsk projects in the
list of key five-year plan construction sites, but this fell
far short of creating the type of "territorial production
complex" that many thought necessary for optimal
exploitation of West Siberian resources. In short, in
1975-76 the leadership took the course that promised
the greatest immediate payoff, least immediate cost,
and-probably-the least immediate economic and
X1 political risk.)
Strategy
Since the mid-1950s the average annual rate of growth
of natural gas production has been signifcantly greater
than that of oil or coal. CIA projects a fairly steady
annual rate of growth of about 6 percent through
1990.35 Despite problems that have occurred in extrac-
tion and transportation, gas has certainly been a
success in comparison with the record of many other
branches of the Soviet economy, and its future growth
prospects are correspondingly bright. Yet gas produc-
tion may be examined not only in the context of
progress or failure to meet one-year and five-year plan
targets, but also in the context of the gap between what
these plans have been and what they might have been if
there had been the political will to pursue an "unbal-
anced," gas-oriented energy strategy.
The argument for an energy strategy that places far
more emphasis on natural gas development than is
currently the case (a strategy we shall refer to as Big
Gas) is quite simple.36 Gas is the one energy branch in
which the resource base and level of existing technol-
ogy could conceivably permit a relatively rapid leap in
output. According to published Soviet figures, proven
and probable gas reserves are enormous; in 1977 the
ratio of reserves to production was 84, far higher than
the estimated ratio for oil. There is some question as to
the firmness of these figures-a subject discussed
below. But obviously a huge gap exists between output
and potential output that could in principle provide a
base for "solving" the Soviet energy problem in the
near-to-middle term. The bulk of the currently known
reserves are found in the north of Tyumen, although
new resources have recently been discovered in Astra-
khan, north of the Caspian Sea. In Tyumen high-
quality gas is found at shallow depths in a relatively
small number of giant fields. Extraction costs, it is
argued, are extremely low. Thus the Big Gas strategy
requires large-scale development of Medvezh'ye,
Urengoy, and other north Tyumen fields, many of
them located above the Arctic Circle.
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The key to the Big Gas strategy has been transporta-
tion of the gas by pipeline out of north Tyumen to the
Urals, European USSR, and abroad. It is part of the
Big Gas strategy that gas be used as a fuel for power
plants, and some argue that part of the gas should be
used to fire thermal stations right in Tyumen, with the
transmission of energy over long-distance powerlines tc
the Urals and farther west. Once the gas has been
transported, there must be a major substitution of gas
for oil in power generation, more use of it as a
feedstock for chemical production, and some use of it
as a fuel for transport. Gas is seen as a highly versatile,
clean, and easily handled fuel that can release oil for
deeper refining and more profitable use. Through its
export potential, gas also is viewed as having the
capacity to finance its own development.
Proponents and Opponents
The main actors in the debate over gas consist of a hard
core of Big Gas supporters, some outright opponents,
and a larger and more ambivalent "floating" group in
the middle. Because of a common outlook and the
geographical location of the main gas reserves, there
has been much overlap of Big Gas proponents with
supporters of the Hydrocarbon solution. There is no
question in the minds of both that a maximum effort
must be made to raise oil output in Tyumen; the only
question is whether, in addition, an extraordinary
effort to sharply increase gas production is feasible.
Tyumen political leaders such as Bogomyakov and
Shmal', economic administrators such as the chief of
Glavtyumengeologiya, Salmanov, and specialists like
V. S. Bulatov of Tyumen NIIGiprogaz and Nesterov
have been among the most vocal advocates of Big Gas.
They have been supported by academician Abel
Aganbegyan, director of the Institute of Economics
and Organization of Industrial Production of the
Siberian Division of the Academy of Sciences
In Moscow the most vociferous, and probably the most
prominent, advocate of Big Gas has been the Minister
of Construction of Petroleum and Gas Industry
Enterprises, Boris Shcherbina. Shcherbina long ago
went on record as believing that gas development could
bring about a radical shift in the Soviet energy
balance, and he has held to this position. An accelera-
tion of Tyumen's gas industry would have enhanced
Shcherbina's role when he was first secretary of
Tyumen obkom before 1973, and it unquestionably
Abel Aganbegyan
Director, Institute of Economics
would promote his personal and bureaucratic interests
now: it is his ministry that builds the pipelines from
Tyumen. Shcherbina may have been joined by leaders
of the USSR Ministry of Geology, who also have
probably stood to gain institutionally from an expan-
sion of the gas industry, and by the Ministry of Foreign
Trade. Other Moscow-based supporters have probably
included former Minister of Oil Shashin, who was
interested in dampening the rising demand for oil, and
Academician Nekrasov, the chairman of Gosplan's
SOPS." None of these individuals were centrally
located in the energy policymaking structure, although
Shcherbina and Shashin had good access to the top
decisionmaking authorities, and Nekrasov had con-
tacts outside Gosplan in the Academy of Sciences, the
State Committee for Science and Technology, the
Presidium of the Council of Ministers, and rob-
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The opposition to Big Gas has almost certainly been
strongest where at first glance one might least expect
it: in the Ministry of Gas itself_
Kortunov's successor in 1972, the Azerbaidzhani Sabit
Orudzhev, has been the most vocal opponent of the Big
Gas strategy.38 Over the years he has consistently
rejected all major aspects of this solution to the energy
problem. (His views are discussed below.) In this
respect his attitude toward Tyumen development has
been markedly different from that of Shashin and the
Ministry of Oil, who wanted to accelerate Tyumen oil
production but appear to have thought that this would
be insufficient to sustain the Hydrocarbon energy
strategy.
The fact that the minister responsible for gas produc-
tion has visibly resisted Tyumen and displayed a
preference for the more temperate Orenburg zone,
where production and pipeline problems are not as
great as in northern Tyumen, can hardly have been an
argument in favor of the Big Gas strategy in the eyes of
Soviet leaders unversed in energy matters. Orudzhev,
to an even greater degree than his opponent
Shcherbina, has had a thoroughly "political" past.
Like Baybakov, Orudzhev is a charter member of the
Stalin-generation politico-economic elite in Azerbai-
dzhan. And it can only have been through long-
cultivated connections in the party Central Committee
apparatus that Orudzhev recouped his fortunes in the
early 1960s and got himself promoted from Deputy
Minister of Oil to Minister of Gas in 1972. At this
juncture he may have received support from the
Azerbaidzhan first secretary, Aliyev, or the Central
Committee CPSU secretary, Kapitonov, but in the
final analysis his promotion must have been a roved
by Kirilenko or Brezhnev, and probably both
The middle group, larger than either the proponents or
opponents of the Big Gas strategy, has swung from a
willingness and even eagerness in the early 1970s to
consider the gas option to a conviction by 1975-76 that
it could not-or should not-be implemented. This
was the "majority" opinion Academy of Sciences
President Aleksandrov referred to in 1977 that thought
that gas was not the solution to the Soviet energy
problem." It includes Kosygin and Baybakov for
certain, probably Deputy Chairmen Novikov and
Dymshits, and perhaps Party Secretary Dolgikh. It
also appears to include virtually the entire high-level
scientific energy advisory corps of Kirillin,
Aleksandrov, Styrikovich, Melent'ev, and Mel'nikov.
As we shall see below, the Academy advice may be
sincere, but it has been far from disinterested.
Issues
The main issues involved in the discussion of Big Gas
have been gas reserves and production capacity, the
cost of north Tyumen development, gas transportation,
and gas utilization. These issues have interacted with
broader questions of economic policy (for example,
development of the steel industry) and Soviet foreign
economic relations.
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The discovery of enormous gas deposits in north
Tyumen during the 1960s led to increasingly bold
projections of future output. It is instructive here to
note the escalation in Shcherbina's estimates of
Tyumen's production capacity. In 1966 he asserted
that by 1975 Tyumen could produce as much gas as the
entire country did in 1975, that is, 128 billion cubic
meters (Tyumen's 1975 output in fact turned out to be
36 billion). At a Tyumen Oblast party conference in
1968, Shcherbina claimed that on the basis of known
reserves it was now possible to produce 300 billion, and
in the future 400-500 billion. Two years later he stated
that the present potential was "over" 500 billion, with
a future potential of "over 1 trillion." By 1973 he
stated to the Presidium of the Siberian Division of the
Academy of Sciences that the reserve base would
already support a production level of 600-700 billion.
And by 1974 he was asserting that it would presently
be possible to produce 700 billion, with a possibility in
the very near future of 1.5 trillion. Shcherbina was not
talking abstractly here about a theoetically desirable
ratio of production to reserves, but about tar ets at
which policy should actually aim. 25X1;
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Drilling site during the
West Siberian winter
In all probability the annual capacity figures ogy's interests. (The geologists are paid four times less 25
Shcherbina has employed have not been as hard as he for discovering reserves officially categorized
has made them appear to be; that is to say, economic "noneconomically exploitable.")
policymakers have probably been confronted with a
broader range of uncertainty at both the high and low
ends of estimates. As in the case of oil reserves, the
setting of gas reserves and peak production capacity is
a highly politicized activity that engages the basic
institutional interests of the Ministries of Gas and
Geology and the career interests of their leaders. It has
been asserted, for example, that when the annual
capacity of Medvezh'ye was being negotiated, the
Ministry of Gas successfully defended its interest in a
low-peak capacity by manipulating an artificial dis-
ex
loitable
d economicall
ll
ti
ti
b
t
y
p
ween so-ca
e
nc
on
e
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(balansovye) and noneconomically exploitable
(zabalansovye) reserves, leading to a ludicrously low
figure that severely damaged the Ministry of Geol-
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Laying a gas trunkline
from Medvezh'ye through
swampy terrain
Transportation has been the crux issue involved in the
Big Gas strategy; the problem over which the Soviet
economic leadership and consultative bodies have most
agonized, and the one which they have least success-
fully resolved. Here, in concentrated form, are ex-
pressed the problems of remoteness of sources from
consumers, Arctic development, resource allocation
within the economy as a whole, technological lag, and
involvement with capitalism in the international
economy. The details of pipeline construction have
been treated elsewhere.' What should be stressed here
is the inability of Soviet domestic pipe mills and
machine-building plants to supply the quantity and
quality of pipe, compressors, and valves required for
the gas industry, and the continual search by the
leadership for some alternative to conventional large or
superlarge diameter pipeline transport.41
If technical metallurgical problems could be resolved,
the two most logical responses to the pipe production
problem would be either to increase total steel produc-
tion, making more available for pipes, or to reallocate
existing output among end users. Both responses raise
what have so far proven to be intractable political
issues. Consequently, the Soviets have been compelled
to seek relief by purchasing large quantities of pipe
abroad, either with scarce hard currency or by
mortgaging future output through compensation deals.
This has not been comfortable for Soviet leaders. In the
eyes of some officials the whole conventional, large-
diameter pipeline approach to gas transportation is
rapidly becoming untenable. As Shcherbina put it in
1975, "Despite the perfecting of welding and assembly
machinery, and increase in pipe diameters and im-
provement in quality, the possibilities of improving the
traditional technology of transporting oil and gas by
pipelines will quickly be exhausted."42
Since the early 1970s Kosygin and Baybakov have lent
their support to attempts to find more cost-effective
means of transporting natural gas. The three most
promising lines of attack have been in reducing the
temperature of the gas (thereby increasing the volume
transmitted), raising the pressure in the pipelines
(thereby increasing the flow), and packaging the gas in
solid hydrate form in "capsules" (thereby reducing the
drag). Research has been promoted in each of the three
areas, but has so far had no impact whatsovever on the
actual transport of gas.
How to build pipelines has been one issue, but where to
build them has been another. Medvezh'ye, Urengoy,
and the other large gasfields are located roughly 1,100
kilometers north of Tyumen City and the Urals heavy
industrial oblasts of Chelyabinsk, Sverdlovsk, and
Perm. The shortest route to the central, north, and
west European regions of the USSR, as well as to the
main gas export markets, lies along a line stretching
southwest from north Tyumen through the industrially
undeveloped Komi Republic, bypassing the Urals and
Volga industrial centers far to the south. Since the
mid-1960s the issue debated has been whether to take
the north Tyumen gas out through this "Northway,"
or to follow a "Southway" dropping down to Surgut
and Tyumen City and then west to the Urals and
beyond.
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One critical issue here has been permafrost, which
covers significantly more of the path of the Northway
than of the Southway. In 1967-68 the initial decision
went in favor of the Northway, and construction was
completed in late 1971 of the "Northern Lights"
trunkline running from Nadym (Medvezh'ye) to
Ukhta (Komi ASSR) to Torzhok with a connection to
Moscow (see the foldout map at the end of this paper).
The design for this line called for special pipes and
supports to prevent melting of the permafrost. How-
ever, because of a lack of the specified materials, then
Minister of Gas Kortunov personally ordered that the
line be constructed of ordinary pipe simply laid on the
ground. With the spring thaw in 1972, the pipes split
open and sank into the permafrost, provoking a major
I I"scandal." Responsibility for the
technical side of this fiasco was palmed off on the
hapless director of the institute that had designed the
pipeline (despite the design's permafrost specifica-
tions), and Kortunov was put in charge of a newly
created Ministry of Construction of Petroleum and
Gas Industry Enterprises, which made him responsible
again for pipeline construction! The political outcome
was that those opposed to the "northern strategy" used
the episode to prove that major gas trunkline construc-
tion across the northern permafrost areas was not
feasible and to shift the main focus of attention away
from Tyumen gas onto the comparatively small but far
more accessible Orenburg gasfield. This reduction in
the priority of development of the north Tyumen fields
may well have implied less interest in export of this gas
to the hard currency market. It also probably mirrored
an intention to save Tyumen gas for more "qualified"
consumers, particularly the Urals metallurgical indus-
try, rather than to transport it to regions where more of
it would be used as boiler fuel." This objective is simply
one facet of a broader controversy over how natural gas
should be utilized.
The outright opponents of Big Gas have argued their
case largely in terms of a particular vision of gas
utilization, articulated most consistently by the Minis-
ter of Gas, Orudzhev." Orudzhev has repeatedly stated
that natural gas should be considered an extremely
valuable nonrenewable resource; that its price should
be steeply raised and conservation measures enacted;
and that it should not be used as a boiler fuel, but used
more and more only for industrial purposes. Not
surprisingly, Orudzhev has strongly resisted the North
Star project to export liquefied natural gas to the
capitalist West, although he has been happy enough to
receive imported Western equipment for the gas
industry. In this context he and others have argued
that exporting natural gas to the West is to sell one's
patrimony and behave-wittingly or not-in an
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Orudzhev's personal interests are well served by his 25X1
principles. Northern gas extraction and pipeline opera-
tion have been beset with constant difficulties, and
these would be multiplied several fold by the imple-
mentation of a Big Gas strategy. Unlike Shcherbina,
Orudzhev has probably no higher aspiration than
hanging on to his job. To protect this interest, he needs
as modest a plan as possible, together with as much
certainty and control over the situation as can be
attained. His manifest concern over gas conservation
mirrors the politically unpleasant role he must perform
of denying gas to whole oblasts during interruptions in
supply-especially in the wintertime. Despite tech-
nical difficulties, Orenburg gas suited Orudzhev's
needs to have a more comfortable alternative to rapid
Tyumen development, and it could be justified in
ideologically strong terms as a response to the objective
requirements of economic "integration" within the
"socialist commonwealth" even though it made little
contribution to a solution to the larger Soviet energy
problem. By the same token, Orudzhev's "patriotic"
attack on gas deals with the capitalists, however
unjustified in terms of the size of declared Soviet
reserves, the small amounts of gas actually involved,
and the need for Western financial support of Soviet
energy resource development, has probably struck a
responsive chord in some circles of the Soviet hierarchy
and has enhanced the political risk of urging deeper
involvement with and concessions to the West in the
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Construction of the Orenburg
gas trunkline to Eastern Europe
Yet Orudzhev's position on gas utilization has not gone
unchallenged. In the second half of 1976, when the
current five-year plan objectives were still being
firmed up, the Tyumen obkom first secretary,
Bogomyakov, explicitly joined issue with Orudzhev in
a sharply worded appeal for a Big Gas strategy:
I do not agree, for example, with the Minister of
Gas S. A. Orudzhev, who is beginning to play
down the possibilities of development of the
branch, saying that we ought to elaborate a long-
term program to reduce the utilization of natural
gas as a boiler fuel. If we do not increase the use of
gas for this purpose then there will simply be
nowhere to employ it. The growth of gas extrac-
tion cannot be used just by highly qualified
consumers. We must shift more and more gas to
the production of electrical energy-this is where
the future of the branch development lies, which
has colossal possibilities in our [Tyumen]
complex.
Here are some data. Among the deposits discov-
ered in the oblast, 17 have already been prepared
for industrial development. If one were to think
today about superhigh tempos of development and
doing what up to now the country has not been
able-to increase each year the extraction of
Tyumen gas by 40 billion cubic meters-then by
the end our century, by 2000, we could raise
extraction to a trillion cubic meters. The
undiscovered potential reserves are estimated to
be two-to-three times larger than the discovered
reserves. One asks oneself, wouldn't we be nig-
gardly not to use such a lavish gift of nature?
Development of the gas industry to a large extent
depends upon a reevaluation of the significance of
gas as a fuel.
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By "reevaluation" Bogomyakov meant elevation of
electric power generation to a status equal to that of oil
and gas extraction in the Tyumen economy, with
construction of 10,000- to 20,000-megawatt gas-fired
stations for power generation for the European USSR
region. In a remarkably frank put-down of the Big
Coal strategy, Bogomyakov continued:
If you compare a gas power plant with a coal
one-it's like a toy alongside a mastodon! I am not
against developing the Kansk-Achinsk coalfields
and building electric stations there. The
Krasnoyarsk comrades act correctly when they
energetically press the solution of these questions.
Let them build coal power stations quickly and
provide in this fashion not only for today's needs
of the region, but also its long-term future. Let
them locate near these power stations much
energy-intensive production. But when they try to
convince me that the KATEK [Kansk-Achinsk
Fuel-Energy Complex] power stations are being
built in order that their electricity even now may
be transmitted to the Urals and the European
regions of the country, this sounds economically
unconvincing to me. An analogous decision based
on Tyumen gas would be more profitable.
To return to the starting point of our thought I
would like to repeat: the indeterminacy of per-
spectives on the future hinders the creation of a
firm development plan for the Tyumen complex.
Because of this our tempos even today are
lagging."
The fact that Bogomyakov could so openly call into
question an important component of the energy
balance strategy enunciated several months earlier at
the 25th Party Congress does indeed point to an
"indeterminacy of perspectives." But ambivalence
over Tyumen gas goes back a long way.
Developments
As early as 1965, Shcherbina was lobbying at a
Supreme Soviet session for a Big Gas system that
would deliver north Tyumen gas to the Center,
Northwest, Belorussia, and the Baltic republics, and
favorably contrasting this variant with gas supply from
Central Asia. Following the party congress in the
spring of 1966 he reported to a meeting of the Tyumen
party aktiv that the Council of Ministers had given the
go-ahead for design work to begin on a Big Gas system,
and in July 1966 a Council of Ministers resolution
actually instructed the Ministry of Geology and
Ministry of Gas to work out a 10-year plan for
developing north Tyumen gas that would raise output
in 1975 to 110-120 billion cubic meters. A decision was
taken in 1967-68 to build the "Northern Lights"
pipeline from Medvezh'ye to Moscow, and construc-
tion got under way in 1970.
25X1
Despite intense lobbying, however, the momentum
behind Big Gas development was not sustained.
Kosygin's fact-finding trip to Tyumen in January 1968
apparently did not enlist his support for Big Gas, and
the critical 11 December 1969 Central Committee and
Council of Ministers resolution on Tyumen develop-
ment called only for acceleration of oil extraction. A
Ministry of Gas delegation that visited Tyumen in late
1969 or early January 1970 lowered the 1975 target to
70 billion cubic meters. Although further attempts
were made to reassert the importance of north Tyumen
gas,46 its subordinate role for the time being in Tyumen
development was confirmed by the Ninth Five-Year
Plan (1971-75).47 By the end of 1972 the 1975 target
was said to be only 44 billion cubic meters.
Despite the drift of plan decisions, though, much
thought was being given to Tyumen gas. Hopes had
initially been fixed on the extraction of gas from
Medvezh'ye via the "Northway" route. When the
"Northern Lights" pipeline disaster became apparent
in the spring of 1972, just as a study was completed
that showed the limits to future growth of oil produc-
tion, the Ministry of Gas and several other organiza-
tions were assigned the task-with Baybakov's ap-
proval-of designing a system to transport sufficient
north Tyumen gas to "solve" the Soviet energy
problem to the year 2000.. The so-called Big System
that was proposed featured the delivery of 130 billion
cubic meters of gas per year to the Urals region and
170 billion to the European USSR through a set of 10
parallel pipelines following a "Southway" route from
Urengoy that traversed the least permafrost.48 The
preliminary estimates of this proposal presented to
Gosplan in September and October 1972 are said to
have indicated a cost of 22 billion rubles and a need for
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20 million tons of steel (approximately 20 percent of
one year's total USSR steel output). Phased over a
number of years, this would not appear to have been an
unreasonable proposition. Nevertheless, at this impor-
tant juncture, confronted by what they undoubtedly
perceived as unacceptably high costs (especially in
metal), economic policymakers recoiled from the
notion of solving the Soviet energy problem at one
stroke with the "Big System" and sought alternative
solutions.
One possibility was to finance northern gas develop-
ment through compensation deals with the West. This
idea went back at least to the 1964-65 period, following
the major gas discoveries in Tyumen. It was strongly
supported by Kosygin's energy adviser I. A. Popyrin,
who-it is said-was especially interested at that time
in the hard currency earning aspects of such trade.
Two large liquefied natural gas projects were proposed
in the second half of the 1960s based on north Tyumen
and Yakutiya. Initial negotiations with the French
"Gaz Ocean" firm in the late 1960s fell through, but
interest in the projects heightened with the growth of
detente in the early 1970s and reached a peak in 1972
with President Nixon's trip to Moscow.
consumated with the Germans, Japanese, and others
since the 1972 summit compensated for inadequate
Soviet pipe production but did not permit a Big Gas
breakthrough.
Meanwhile, following the rejection of the "Big Sys-
tem" in late 1972, other domestic alternatives were
also being canvassed. A decree adopted by the Council
of Ministers in November 1972 called for additional
construction of pipeline and compressor stations on the
Central Asia - Center system, as well as work on the
Orenburg deposits. And at about this time the so-
called Big Commission chaired by Academician
Styrikovich was created and assigned the task of
exploring all possible solutions to the Soviet energy
problem.
In the gasfield area a possible avenue of attack was
pursued, as mentioned above, by a subcommission of
the Big Commission formed to explore the possibilities
of capsule transportation of natural gas in hydrate
form.' The key members of this group were the
chairman, Academician Nikolay Cherskii, chairman
of the Yakutsk Division of the Academy of Sciences,
and Baybakov's energy adviser, Yuri Bokserman. This
subcommission worked out a plan to build the "Big
System" as a capsule system using three pipelines
instead of 10. According to Gosplan calculations the
capsule system would transport the same volume of gas
Between 1972 and 1974 the Soviet leadership appar-
ently seriously hoped that the North Star and
Yakutiya deals would provide a mechanism for acquir-
ing the financial resources, pipes, and compressors
needed to lay the foundation for a Big Gas strategy.
The negotiations over North Star, difficult to begin
with, were attacked by influential figures within the
Soviet elite-including Minister of Gas Kortunov and
his successor, Orudzhev. Orudzhev's general opposi-
tion to Big Gas, described above, was reinforced in this
instance by his recognition that he would find himself
in the untenable situation of having to answer before
the Politburo for written complaints from the Ameri-
cans concerning the delays and foulups which would be
inevitable on the Soviet side. When passage of the
Stevenson Amendment in December 1974 blasted
hopes of getting the large credits needed to finance
North Star, evoking Soviet anger and subsequent
rejection of the US-USSR Trade Agreement, it
became clear to Soviet policymakers that their energy
problem was unlikely to receive a quick fix from the
West, but by this time nearly three more years had
passed. The large gas pipe import deals that were
as the "Big System," but at a cost of only 8 billion
rubles investment and 7 million tons of steel.
The proposed capsule system was strongly opposed by
Styrikovich (who later switched sides), by some other
scientists who disagreed with the principle underlying
capsule transportation, by the main gas institute
(VNIIGaz), which had a vested interest in designing
its own system of long-distance gas transportation, and
by Orudzhev personally. After gaining Styrikovich's
backing and that of Central Committee Secretary
Dolgikh, as well as Baybakov's strong patronage and
assistance from Popyrin, the capsule transport pro-
posal was formally approved: first by the Big Commis-
sion (representing essentially the Academy of Sci-
ences), then by the Collegium of Gosplan, and finally
by the Presidium of the Council of Ministers. On 23
May 1974 the Presidium passed an elaborate resolu-
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tion over Orudzhev's objections organizing a special
institute to design capsule systems and setting out
some 28 projects to be worked on, including the
Urengoy-Moscow system.
Between 1973 and 1975, Big Gas remained in limbo.
No comprehensive gas program was formulated, as Big
Gas proponents argued their case and skeptics voiced
various objections. At a Gosplan Collegium meeting at
the end of 1973 devoted to a "serious discussion" of
Tyumen prospects, Erv'e, the head of Glavtyumen-
geologiya, presented strong arguments in favor of rapid
development of Tyumen gas; and, summing up the
discussion, Baybakov agreed that a plan should be
energetically drawn up, provided that new solutions to
the transport problem were found which reduced the
expenditure of pipe.50 In the middle of 1974, Pravda
published an article by Shcherbina that compared gas
favorably with coal;51 and in 1975 Shcherbina de-
manded a radically new Big Gas approach featuring
gas-burning power stations in Tyumen, low-tempera-
ture and liquefied transportation of gas, and rapid
production of the multiwalled large-diameter pipe
sponsored by the president of the Ukrainian Academy
of Sciences, Boris Paton.52 The RSFSR Minister of
Geology L. I. Rovnin, an old Tyumen hand, pro-
claimed that while "the main attention now is concen-
trated on the search for oil, and this is correct," this did
not mean that the search for additional gas reserves in
Tyumen should be halted, since "our country in the
near future plans sharply to increase the extraction of
gas and in the shortest possible time raise it to 1 trillion
cubic meters a years" There were also elaborate
technical arguments defending the low cost of Tyumen
gas, particularly in comparison with Kansk-Achinsk
coal.54
But, as Shcherbina complained, there was also "vacil-
lation" in the evaluation of north Tyumen gas,
particularly among the core group of Academy of
Sciences energy advisers. In an article on optimization
of the fuel-energy balance, Academician Melent'ev
emphasized that it took almost three times as much
metal and 19 times as much pipe to produce an
increment of 100 million tons of standard fuel from gas
as from coal; and he also stressed the long leadtime
needed to develop West Siberian gas.ss In 1974 and
1975 Academician Styrikovich began emphasizing the
need to focus on the extraction of gas condensate-a
line that had clear anti-Big Gas implications." And in
1975 Academician Mel'nikov dwelt on the rising costs
of gas extraction and "difficulties" in supplying pipe,
while he ignored altogether the possibilities of a sharp
increase in gas productions' These doubts reflected a
shift toward the Combined Resources strategy dis-
By 1975-76 the key issue had become whether or not
the 10th Five-Year Plan (1976-80) would force the
pace on gas. There was some reason to suppose that it
might, not only because of the presence of large gas
reserves and the problems being encountered in oil
production, but also because one of two potential
technical breakthroughs in gas transportation-the
capsule system-apparently had by this time come to
be seen as sufficiently promising to evoke a reconsider-
ation of the "Big System.'I
month interval before publication of Basic
Directions, it was apparently accepted in Gosplan
circles that there would indeed be a "Big System" t pe
development of Urengoy.
However, when the Basic Directions was published in
Pravda on 14 December 1975, at the time of the pre-
Congress plenum of the Central Committee, the
document contained only a vague reference to the need
to "accelerate scientific research and experimental
design work in creating fundamentally new types of
gas transportation." There was no mention of the
capsule system, no mention of Urengoy or Medvezh'ye,
no mention of the construction of any gas pipeline from
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north Tyumen, no mention of large-diameter pipe
production, and only a passing reference to the target
of 115-145 billion cubic meters of gas from West
Siberia by 1980-a relatively modest figure in the
"Big System" context. The low priority indicated by
these ommissions appears to have been sustained
throughout the process of adoption of the five-year
plan in 1976, despite lobbying efforts to the contrary.
It is clear that, once again, the Soviet leadership had
avoided a decision on Big Gas development. Reluc-
tance to make a large commitment of resources to an
untested and risky new technology was undoubtedly a
factor, to the extent that revivification of the "Big
System" was tied to the capsule system. There was also
the investment factor in general. Kosygin's report at
the 25th Party Congress suggested that he, for one,
was concerned about the cost of gas transportation and
the drain it imposed on the Soviet metallurgical
industry; the thrust of his remarks was that gas
pipeline construction should be constrained in the 10th
Five-Year Plan. But there may also have been highly
personal considerations involved, which-if true-cast
a revealing light on Soviet energy policymaking.C
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While Big Gas was thus provisionally laid to rest by
Soviet policymakers in 1976, considerable ambiguity
remained as to what in general would be done in north
Tyumen during 1976-80, and what specifically would
happen to Urengoy. The fact that Bogomyakov's
attack on Orudzhev and appeal for large-scale develop-
ment of Tyumen gas was published in late 1976
suggests, as noted above, that there was as much "non-
decision" as decision in the 10th Five-Year Plan.
In June 1975, Orudzhev had mentioned the possibility
of building three pipelines from Urengoy in the 1976-
80 period, but had cast doubt on the feasibility of this
by observing that existing technology could not cope
with such a task. At an unusual joint meeting of the
Collegiums of the Ministry of Construction of Petro-
leum and Gas Industry Enterprises and Ministry of
Gas in December 1975, an "elaborated program" was
approved for building a system of pipelines along the
"Northway" route of Urengoy-Nadym-Punga-Vuktyl-
Torzhok-Minsk-Ivatsevich-Dolina-Uzhgorod-US S R
border. According to Shcherbina's deputy, Yu. P.
Batalin (formerly in charge of pipeline construction in
Tyumen), this project-which would transport Komi
as well as Tyumen gas-was "the most important task
of the Ministry of Gas and Ministry of Construction of
Petroleum and Gas Industry Enterprise collectives." It
was to be completed in a single year-1976-and
carry 80 percent of the USSR's total growth in gas
output. There was no mention of any other line from
Urengoy.60 Only two disconnected sections of the line,
however, were in fact completed in 1976; and Urengoy
itself was not linked to this old "Northern Lights"
route until 1978. In the meantime, the "Northway"
strategy of tapping Tyumen gas had given way, once
again, to a "Southway" approach. This shift was
manifested in a sudden decision to proceed with a
pipeline from Urengoy to the Urals city of
Chelyabinsk, and to build it in a single year.
Although work on the Urengoy field itself was under
way in 1976, one presumably well-informed official,
the director of the Tyumen State Scientific Research
and Design Institute of Natural Gas of the Ministry of
Gas, laid out a "southern variant" of Tyumen gas
development in which the Vyngapur, Gubkin, and
Komsomol'sk gasfields would be produced during the
10th Five-Year Plan in order to feed the Tobol'sk
petrochemical combine further south in Tyumen
Oblast (as Orudzhev probably favored), but in which
the actual production date of Urengoy was left
ambiguous. This official, P. T. Shmyglya, who did
mention that the "southern variant" involved "con-
struction of a system of trunklines from the northern
regions of Tyumen Oblast to the Urals (Urengoy-
Chelyabinsk)," nevertheless placed more emphasis in
his article upon the near-term cost-effectiveness of 25X1
reconstructing Medvezh'ye.6' The schedule for bring-
ing Urengoy into operation and the pipeline approach
to it appears to have been still undecided as late as July
1977.62 Perhaps the first unambiguous public reference
to construction of a Urengoy-Chelyabinsk line oc-
curred in October 1977.63 In November there was an
authoritative reference to the construction of four
pipelines from Urengoy: Urengoy-Punga-State Border
("Northern Lights" route); Urengoy-Chelyabinsk;
Urengoy-Kuibyshev; and Urengoy-Punga-Nizhnaya
Tura-Perm-Elets ("Urengoy-Center" route).64 But
neither of these references provided a time framework
or suggested any particular sense of urgency; this was
to come only after the December 1977 Plenum of the
Central Committee. 25X1
The Combined Resources and Big Coal Alternatives
At the present time the operational implications of
both the Combined Resources and the Big Coal
strategies converge on coal development. Therefore the
two are treated together in this appendix under the
rubric of Combined Resources. The difference be-
tween the two strategies is that while Combined
Resources stresses coal and other resources, Big Coal
discounts the early availability of substitutes other
than coal for hydrocarbons. As Chukhanov, the
leading Big Coal proponent, puts it in a thinly veiled
reference to the Soviet situation:
It is not easy to find a way out of the situation
which has come about. Great hopes are placed in
many countries [sic], including the USA, in
atomic electric stations, but as long as there are
not sufficiently cheap and reliable breeder reac-
tors, the provision of atomic electric stations with
economicall 'ustifiable fuels is also a complex
problem.65
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Strategy
Combined Resources emphasizes simultaneous devel-
opment across the entire range of energy resources. A
key objective is "optimization" of the elements com-
posing the energy balance, measured in cost terms.
This objective is qualified by recognition of the need to
build sufficient "reliability" into the energy balance;
that is to say, the need to select a production strategy
that combines a low total cost with a high probability
of avoiding disastrous "interruptions" in energy de-
livery. Combined Resources advocates are sensitive to
the depletion of nonrenewable hydrocarbons, but at the
same time they are aware of the potential advantages
to be reaped from the USSR's current relatively
advantageous position in the international energy
market. They urge that this comparative advantage be
deliberately taken into account in planning Soviet
energy production and consumption.
issues-a topic discussed below. 25X1
USSR: Major Central Siberian Coal Basins and Power Transmission Lines
Coal basin
o Major hydroelectric station
Power Transmission Lines
- 500 kv AC (higher voltage lines noted)
Chelyabinsk Lo Omsk
Petrnnavlnv,k .._ S
Among the proponents of Combined Resources are
some individuals who were at one time enthusiastic
about the possibilities of natural gas. This enthusiasm
has now waned, and the medium-term answer to the
Soviet energy problem is conceded by them to lie with
coal. Specifically, hopes are pinned on development of
the truly enormous reserves of brown coal in the
Kansk-Achinsk basin, as well as the much smaller
deposits of subbituminous coal at Ekibastuz in
Pavlodar Oblast, Kazakhstan (see map). The Kansk-
Achinsk coalfields stretch some 700 kilometers along
the Trans-Siberian railway, east and west of
Krasnoyarsk in Krasnoyarsk Kray. They have only a
shallow overburden and are thus easily strip-mined.
However, the low calorific value, high water and ash
content, and tendency of Kansk-Achinsk coal to self-
ignite when transported without having been processed
pose technical problems that give rise to major polic
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---- 1150 kv DC
1500 kv AC
Berez6 o
,' therm plant
Kuzbas\Abakan
Sayan
Shushensk
, o akuznets
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If, in the short term, the Combined Resources advo-
cates recognize the unavoidability of heavy reliance on
oil and gas, and, in the medium term, the need for coal
substitution and slow-neutron fission reactors, in the
long term they visualize salvation arising from breeder
reactors and fusion power.66 Few Soviets of whatever
persuasion would disagree with this general scenario.
The point is, however, that in practical terms the
Combined Resources strategy implies assigning high
priority today to R&D connected with middle-term
and long-term solutions to the energy production
problem, and to actually commissioning Kansk-
Achinsk capacities. Keeping all the balls in the air at
once is the essence of this strategy; and this translates
either into increasing the already high total investment
in energy production or effecting a transfer of re-
sources from hydrocarbons to other resources.
Combined Resources advocates, of course, immedi-
ately point to the possibility of at least partially
finessing this difficult choice through vigorous energy
conservation measures and increased efficiency in the
extraction and utilization of fuels drawn from existing
deposits. A serious attempt should be made, they
argue, to reduce the cost of east-to-west energy
transfer by developing energy-intensive industry more
vigorously in Siberia near the sources of coal and
hydropower. In the European USSR there should be a
more rapid acceleration of nuclear power. Recovery
efforts should be intensified in the fossil fuel deposits
west of the Urals, and geological prospecting here
should also be strengthened. A special effort should
also be made to perfect magnetohydrodynamic power
generation (MHD), which-so its supporters claim-
promises a substantial increase in the efficiency of
thermal electric plants. It should be emphasized, of
course, that none of the Combined Resources advo-
cates are "against" oil and gas. Many of them have
been involved in high-level deliberations over Tyumen
development, and all take it for granted that a vigorous
effort will be made to increase oil and gas production.
Proponents and Opponents
Perhaps the most important, albeit cautious, proponent
of the Combined Resources approach has been
Kirillin.67 As Chairman of the State Committee for
Science and Technology, and the deputy chairman in
the Council of Ministers responsible for science policy,
he has been strategically located both to influence elite
opinion on energy production policy issues and to
participate in policymaking. Although he himself has
no doubt found it prudent to adjust his own positions to
accommodate the perceived views of Politburo mem-
bers and influential figures in the Central Committee
apparatus, officials below him have probably in turn
taken cues from him-particularly when their R&D
budgets have been affected by his decisions.
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Kirillin is an electric power engineer by training, and
his most important personal professional commitment
is to the development of MHD generators. He was the
driving force behind the establishment of the Academy
of Science's Institute of High Temperatures, headed
by A. Ye Sheyndlin, which is the leading MHD
research organization in the Soviet Union. As noted
earlier, both Styrikovich and Melent'ev work in this
institute, they both are also electric power engineers by
profession, they both have been collaborating with
Sheyndlin and Kirillin in MHD research, they both are
longtime friends of Kirillin, and they both are strong
supporters also of the Combined Resources approach.68
MHD is a direct beneficiary of Combined Resources:
it is funded as one of the "combined" palliatives for the
energy problem, and it is now being designed with
Kansk-Achinsk coal in mind as a basic fuel. Thus a
situation exists in which three of the top scientific
"judges" of alternative energy strategies upon whom
the Soviet leadership must to some extent rely have a
personal vested interest in one of these alternatives.
The same observation applies to the President of the
Academy of Sciences, Aleksandrov, who involves
himself directly in long-term energy planning, and the
Academy's first vice president, Velikhov, who has
overall responsibility in the Academy for monitoring
energy research. Both are nuclear scientists, and both
have worked for years in the Kurchatov Institute of
Atomic Energy-Aleksandrov as director, and Veli-
khov as one of his deputy directors. Thus both have a
major stake in one of the other "combined" re-
sources-nuclear power, for which Aleksandrov has
publicly lobbied with great vigor."
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Delivery at a large US-produced magnet to the
Institute of High Temperatures; part of the joint
Soviet-American MHD research program under
US/USSR Energy Agreement
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Petr Neporozhniy
Minister ofPower and Electrification
The other top Academy of Sciences adviser on energy
policy, Mel'nikov, has an analogous direct professional
interest in the Combined Resources energy balance
strategy. He has worked since the early 1930s in the
coal industry as an engineer, top administrator in the
Ministry of Coal, and high-level government consult-
ant on coal mining. His particular speciality has been
strip mining-a subject on which he wrote his doctor's
dissertation. Late in 1977 he was appointed director of
the Institute of Problems of Complex Mastery of
Mineral Resources of the Academy of Sciences,
confirming his status as the key figure for strip mining
in the Academy. In his policy-influencing role of
chairman of the Academy's Commission for the Study
of Production Forces and Natural Resources, it would
be surprising if he has not urged what promises to be
the largest strip-mining operation in world history; he
has certainly advocated coal and Kansk-Achinsk
development in his public statements.'?
Mel'nikov has been linked with two other sources of
support of Combined Resources outside the Academy
of Sciences: the Ministry of Power and Electrification
and the Ministry of Coal. The Minister of Power and
Electrification, Petr Neporozhniy, has-not always
consistently-backed coal substitution and Kansk-
Achinsk development as well as nuclear power. Zinovii
Chukhanov, based in the Ministry's leading
Krzhizhanovskiy Institute of Power Engineering,
has-as noted above-been the most single-minded
advocate of Kansk-Achinsk, with which his role as a
scientist has become inextricably linked." The Minis-
ter of Coal, Boris Bratchenko, has also strongly
supported Kansk-Achinsk, although he-like
Neporozhniy-has emphasized the technical and de-
velopmental obstacles that must be surmounted before
its potential can be realized. And A. A. Krichko,
director of the Ministry of Coal's Institute of Fossil
Fuels, has likewise backed Kansk-Achinsk.
This core of advocates of the Combined Resources
strategy has received support from some individuals in
Gosplan, including Baybakov and Yatrov, director of
the All-Union Scientific Research Institute of Com-
plex Fuel-Economic Problems; from Krasnoyarsk
party officials; and probably from some figures in the
Central Committee apparatus. It would not be un-
reasonable to suppose, in particular, that Central
Committee Secretary Dolgikh, the former first secre-
tary of Krasnoyarsk kraykom, has taken at least some
interest in Kansk-Achinsk. And Premier Kosygin has
clearly identified himself with major elements of the
Combined Resources line over the years.
Visible opposition to the Combined Resources strat-
egy, as already noted, has been concentrated among
the most committed advocates of Tyumen develop-
ment: Tyumen party officials like Bogomyakov, and
the Minister of Construction of Petroleum and Gas
Industry Enterprises, Shcherbina. There have also
been specialists in Gosplan and elsewhere who have
doubted the economic rationality of transmitting
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Kansk-Achinsk power to the West, and who have
argued that it should be employed solely in energy-
intensive industry in Siberia." The articulation of this
point of view in 1973 in the party's theoretical journal,
Kommunist, strongly suggests that it has some support
within the Central Committee apparatus.73 So does the
effective scuttling of the 10th Five-Year Plan line at
the end of 1977.
argue-although they have not done so in public-that
coal production, thermal power generation, nuclear
power and hydroelectricity-in contrast to oil or gas
production-are areas in which future progress is
substantially less dependent on Western technology,
materials, or credits, and more suited for participation
by the Council of Mutual Economic Assistance
(CEMA)-and Chukhanov has, by implication, pub-
licly justified Big Coal in terms of the need to maintain
Issues
Many of the arguments in favor of the Combined
Resources strategy have already been indicated above.
At the most fundamental level, Combined Resources
responds to the insistent question: What happens after
there is no longer enough oil and gas? In the shorter
term, its supporters claim that it promotes the party
leadership's oft-proclaimed goal of cost effectiveness.
This point has been stated in its most extreme form by
Chukhanov, who argues that only in coal do "threshold
reserves" remain-"those reserves of fuel, the extrac-
tion, processing, transportation and use of which
without polluting the environment above defined
permissible concentrations does not lead to ruin of the
country, to regression, to a cessation of growth in real
national income."74 But cost effectiveness is a key gain
also said to be achieved from the optimizing models
generally favored by Combined Resources advocates.
Still another basic advantage of the Combined Re-
sources approach, so its proponents claim, is the
greater security it provides. On the one hand, it
prevents long-term developmental imperatives from
being swamped by short-term supply needs; on the
other, it produces the most rational course of action in
the face of differential probabilities of failure in
various areas of energy production."
strategic oil reserves.78
But the Combined Resources strategy has its problems
too. The central dilemma that confronts it is one of
funds and time. Can an approach with a longer range
perspective, one that stresses development across all
energy sectors and calls for a heavy commitment of
resources to energy R&D, cope with the urgent
demands for more oil and gas next year? Is there
sufficient slack in the system to sustain the strategy in
the face of unanticipated setbacks or declines in oil and
gas production? In a worsening economic climate, can
more resources be provided to cover the day-after-
tomorrow's energy needs and from whom will they be
taken?
Whatever the final costs of a Combined Resources
energy strategy may be, today's costs will be higher.
Combined Resources call for rapid development of
West Siberia and Kansk-Achinsk, plus heavier invest-
ment in nuclear power R&D. While aiming at
optimization at the margin of all energy sources, this
strategy runs the risk of a diffusion of effort and delay
down the line; of simply being swallowed up by the
forces of "departmentalism" and bureaucratic inertia,
against which-some might argue-only the time-
honored technique of hi hl focused "cam ai ns" has
any prospect of success.
Finally, the Combined Resources approach is probably
presented by its supporters as having definite ad-
vantages for the USSR in the international arena.
Styrikovich has stressed the possibility it provides for
capitalizing (for example, through gas sales) on the
world energy shortage.76 Mel'nikov, quoting Kosygin's
praise at the 25th Party Congress for the Soviet
Union's energy independence, has noted the great
vulnerability of Western countries to price fluctuations
in the world market-something the USSR has
avoided.77 Combined Resources proponents might also
The Combined Resources strategy is also confronted
with serious technical difficulties. There are problems
and choices to be made in both the nuclear and MHD
programs.79 Construction of the "Atommash" plant,
designed for series production of nuclear power plant
components, is lagging behind schedule. But most
critical for the ultimate prospects of the Combined
Resources strategy have been the intractable dilemmas
of Kansk-Achinsk coal.
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Kansk-Achinsk is located over 3,200 kilometers from
Moscow and 1,600 km from the Urals industrial
region. If the energy from the coal is to be transmitted
west on a scale capable of seriously affecting the Soviet
energy balance, a massive transportation problem
must be solved. Further, the poor quality of Kansk-
Achinsk coal, like that of Ekibastuz, has created
major boiler problems when attempts have been made
to burn it in existing power plants, and consequently
its widespread use as a boiler fuel is contingent
upon serious parallel R&D efforts in power plant
A variety of strategies have been proposed to cope with
these difficulties. It has long been evident that
processing Kansk-Achinsk coal in some manner before
it is used would be desirable, and a number of
alternatives have been suggested: the conversion of the
coal into an enriched and transportable "semicoke"
through the pyrolysis technique championed by
Chukhanov; drying; gasification; and liquefaction.
Whether the coal is or is not processed, there is the
option of building enormous mine-mouth power plants
and then transmitting Kansk-Achinsk energy west as
electricity over long-distance, superhigh-voltage lines,
or-in the more remote future-through underground
superconductive cables.
The first difficulty with this option, however, is
designing 800-megawatt units for the power plants
that will run on Kansk-Achinsk coal. More problem-
atic still is the actual power transmission: in order to
make it economically feasible to send power to the
Urals and European USSR, Soviet power engineers
must successfully design and produce a 4,000-
kilometer, 2,200-kV DC superhigh-voltage system,
after having first successfully tested a still-to-be
constructed novel 1,500-kV DC line from Kazakh-
stan's Ekibastuz coalfield to the European USSR.
Alternatively, processed coal could be physically
shipped west. The main variants considered here have
been construction of a separate railway all the way
from Kansk-Achinsk to the European USSR, slurry
pipeline, and capsule pipeline.
Developments
In contrast with the Hydrocarbon and Big Gas
strategies, controversy over Combined Resources has
taken place somewhat more within the Academy of
Sciences, State Committee for Science and Technol-
ogy, and Gosplan institute arena than among produc-
tion ministries, and its ups and downs have so far had
more of an effect on stated policy intentions than upon
the actual allocation of resources, although as a
strategy it does immediatley affect not only the 25X1
scientific establishment but also the basic interests of
the Ministry of Coal, Ministry of Power and Electrifi-
cation, and Ministry of Power Machine Building.
As early as 1969-70, during the formulation of the
Ninth Five-Year Plan 1971-75 , some authorities are
I Iconvinced that the 25X1
existing policy of reliance upon oil and gas in the
energy balance was wrong, and to have begun to lobby
for a resurrection of coal. It is stated that this group,
which used the Transport Commission of the Academy
of Sciences as a vehicle to express its opinion, included
Mel'nikov, Styrikovich, the chairman of the Transport
Commission, Academician Gorinov, several of his
assistants, the Minister of Coal, Bratchenko, an
economist in the Ministry of Coal, Galperin,
Chukhanov from the Ministry of Power and Electrifi-
cation's Krzhizhanovskiy Institute of Power Engineer-
ing, Nekrasov from Gosplan's SOPS, and a party
official, Pavel Kovanov. This group is said to have
prepared a long report that was sent to the Politburo at
the end of 1969. The report argued that oil and gas
should be conserved as valuable chemical raw materi-
als and not burned as fuel. Instead, Kansk-Achinsk
should be developed. When the proposal was exam-
ined, however, it was discovered that the cost in
investment funds and steel was exceedingly high.
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Accordingly, the Politburo issued a decision in 1970
that Kansk-Achinsk development should be put off for
20 to 25 years, that the problem nevertheless should
continue to be studied, and that if, in the meantime, a
mode of transportation cheaper than those currently
available was discovered then the question could be
reopened. This decision was perceived as a defeat by
proponents of change in the energy balance, but they
did see the possibility of reversing the decision through
a technological breakthrough. The Politburo decision
was reflected in the Ninth Five-Year Plan (1971-75),
which-as noted above-maintained the stress on oil
and gas in the energy balance, and also failed to
mention Kansk-Achinsk, although it did refer to
construction of a 4,000-megawatt power station at
Ekibastuz.
This rebuff did not deter advocates of a change in
Soviet energy policy. In 1973, Melent'ev's department
in the Academy of Science's Institute of High Tem-
peratures prepared a major study on nuclear power,
which included an examination of the availability of all
forms of energy over the next decade and the next 25 to
100 years. The study recommended conservation of
petroleum resources, cessation of further building of
hydroelectric stations, and an intensive program of
nuclear power station construction. These conclusions
were brought to Kosygin's attention.80
In February 1974, Styrikovich stated that he had
recently completed a nationwide tour of the USSR to
survey fossil fuel requirements and reserves. The
emphasis he placed upon Kansk-Achinsk coal left no
doubt as to what his recommendations had been. The
time framework of anticipated Kansk-Achinsk devel-
opment was left ambiguous:
ecision had been reached on ow to transmit the
energy. The solution preferred by the Institute of High
Temperatures (namely, by Styrikovich and Melent'ev)
was said to include conversion of the coal to semicoke
using Chukhanov's pyrolysis technique, briquetting of
part of the output for rural heating purposes, and
then-at least in the initial states of development-rail
transportation of this upgraded product. It was stated
that the European USSR would have to be using some
semicoke for electric power generation by 1985.
0
These views squared with those expressed in an article
published by Styrikovich at about this same time. In
the article, Styrikovich called for a "maximum forc-
ing" of Ekibastuz in the period up to 1980-85 and a
simultaneous "forcing" of Kansk-Achinsk to prepare it
to assume a major share of the coal production burden
thereafter. He expressed serious reservations about the
possibility of mastering 2,200- to 2,400-kV DC
superhigh-voltage transmission technology (or more
exotic superconductivity variants), and pushed instead
for a crash program of developing the semicoke
process, with the output then being shipped west either
by a new "coal supermainline railway," or by "various
types of pipelines."
Styrikovich's recommendation that Kansk-Achinsk be
developed was probably taken into account in a
Baybakov directive of early 1974 which ordered SOPS
and all the relevant Gosplan departments to draft
preliminary plans for developing this coal basin over
the 15-year period 1976-90. In contrast with
Styrikovich's. apparent position, the directive spoke
only of the use of Kansk-Achinsk coal to generate
electrical energy for a large energy-intensive industrial
complex that would be created in the region of the coal
basin itself."
Throughout the rest of 1974 and 1975, the Combined
Resources strategy gained further momentum, with
steeply rising world oil prices and Western economic
disarray providing an additional strong impetus. At an
important General Assembly of the Academy of
Sciences devoted to energy questions that was held in
November 1974, top science administrators all argued
for a change in direction of Soviet energy production
policy." Mstislav Keldysh, then President of the
Academy of Sciences, lent his support to an increase of
coal's share in electricity production, and to MHD,
breeder reactors, and fusion power. Kirillin, who gave
the main report, argued that while the old stress on oil
and gas in the energy balance had been correct in the
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past, there should now be a switch to strip-mined coal
as the fuel for base-load power generation. R&D work
on 2,200- to 2,400-kV DC power transmission should
be speeded up. In the opinion of a "majority" of
specialists, Kirillin stated, broad-scale co.struction of
breeder reactors could begin after 1985.64 Styrikovich
called for research on coal gasification and, as he put
it, "agitated" for heavy investment in studies on
pollution control. And Aleksandrov presented a key
policy statement on nuclear power development.
In March 1975, a year after the Gosplan directive
noted above, a meeting of advisory councils of Kirillin's
State Committee for Science and Technology and the
Academy's Council on Complex Problems of Electric
Power was held, at which the long-range intention of
building eight 6,400-megawatt power stations at
Kansk-Achinsk was announced and plans for boiler
design discussed. It was stated on this occasion that
"the first generating units should be put into operation
at the end of the 10th Five-Year Plan."" Later in 1975,
Styrikovich noted that the Academy of Sciences'
Division of Physical-Technical Problems of Power had
"reviewed and formulated recommendations on forc-
ing the extraction and processing of coal from the
Kansk-Achinsk coal basin, and creating power ma-
chinery intended to utilize this coal." 86 Styrikovich,
Kirillin, Mel'nikov, and other speakers also justified a
switch to coal at an invitation-only "public" meeting
on energy policy that was held in 1975.
These expressions of support for Kansk-Achinsk devel-
opment presaged a major shift in Soviet energy policy
that was announced at the 25th Party Congress and
later confirmed in the 10th Five-Year Plan. In essence,
what we have labeled the Combined Resources strat-
egy was officially approved as the party line on energy
production in March 1976 (when the party congress
was held) and October (when the five-year plan was
finally presented).
Kosygin stated at the party congress that it was
necessary to prepare to shift the energy balance away
from oil and gas toward "hydroelectricity, atomic fuel,
and cheap coal"; that Ekibastuz and Kansk-Achinsk
coal would begin to play a significant role in power
generation even before 1980; that intensified nuclear
power station construction in the European USSR
would be combined with rapid construction of coal-
burning power plants in Siberia and transmission of
electricity to the West over the Single Electric Power
grid; and that "a number" of large thermal power
stations in the Urals and Volga regions would be
converted from oil to coal. Subsequently this line was
articulated by many authorities through 1977.87
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Yet even while the new line was being confirmed, 25X1
doubts were being expressed that it would in fact be
implemented. At the 25th Party Congress, Minister of
Coal Bratchenko strongly supported Ekibastuz and
Kansk-Achinsk, but observed:
In the CC CPSU's draft for the 25th Congress,
development of the Kansk-Achinsk basin is
projected. But in the calculations of the five-year
plan resources have still not been provided for
beginning construction of new facilities. We
request that, in revising the plan for 1976-80,
Gosplan USSR allocate the necessary material
and financial resources, bearing in mind that it
takes 10 to 15 years to create enterprises in new,
unpopulated regions. Accelerated development of
the Kansk-Achinsk basin will have a fundamental
influence on the structure of the fuel-energy
balance of the country and will greatly reduce the
consumption of liquid fuel.
His doubts were seconded at the party congress by
Minister of Power and Electrification Neporozhniy,
who pointed to the absence of a long-term development
program for Kansk-Achinsk and remarked:
It is planned to create unique high-voltage electri-
cal transmission lines of 1,150 kV AC and 1,500
kV DC for further formation of the Single
Electric Power system of the Soviet Union and
transportation of large flows of cheap electrical
energy from Siberia to the central regions of the
country. The world [sic] has not yet solved such
problems.
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Over the years preceding the 25th Party Congress,
ambitious forecasts had suggested that by 1980 Kansk-
Achinsk would be producing at least 300 million tons
of coal, and by the early 1990s up to 1 billion tons.88
Yet progress has been slow. The lack of any sort of
comprehensive plan for Kansk-Achinsk development is
a complaint that was voiced not only before the 25th
Congress, but after as well.89 Apart from the usual lack
of horizontal coordination and the display of narrow
ministerial interests, the key reason for the lack of a
program has been the inability of policymakers to
reach a decision on the basic issue of how to transport
and use Kansk-Achinsk coal.
During 1975 and 1976, and probably more recently as
well, a heated debate over this issue is said to have been
conducted in the Permanent Commission of Gosplan
and the Academy of Sciences of the USSR on the
Problem of Extraction, Transportation, and
Utilization of Coal from the Kansk-Achinsk Basin.
The commission is chaired by Mel'nikov, but actually
run by Academician Gorinov who-as noted above-is
also chairman of the Academy of Sciences' Commis-
sion for Transport Problems.
four different transportation
variants were pushed within the commission. The
Ministry of Electricity proposed building large pit-
head power stations in Kansk-Achinsk and then
transporting this energy by high-voltage line to the
European USSR; the Ministry of Railroads proposed
building a special railway to the Center for coal
transportation; Gorinov, Mel'nikov, and others backed
a slurry or capsule pipeline; and a group of Leningrad
scientists suggested construction of a large coal
gasification facility that would send coal-derived
liquefied hydrogen and electric power through a
superconductive cum hydrogen pipeline to the west (a
solution that would probably take decades to imple-
ment).
is roa range o alternatives was being iscusse in
1976, and indeed had been under discussion for some
years. A key question has been the technical feasibility
and relative cost advantage or disadvantage of
superhigh-voltage transmission of electrical energy
over the long distances from Ekibastuz and Kansk-
Achinsk to the Center. The problem here has been,
first, to design and build a 1,500-kV DC line from
Ekibastuz to the Center; second, to build the 1,150-kV
AC line, in order to distribute future Kansk-Achinsk
power within central Siberia and to link Kansk-
Achinsk with the Kazakhstan power grid, permitting a
flow of Kansk-Achinsk power to the Urals or European
USSR; and third, relying on the experience of the
1,500-kV DC line, to design and build a 2,200- to
2,400-kV DC line directly from Kansk-Achinsk to the
Center. Technically, these are extremely difficult
tasks; the world's longest and most powerful DC line
currently in operation is an 800-kV line on the US
West Coast.
Solving the technical problem of superhigh-voltage
transmission has been an elusive goal. Back in 1966,
Mel'nikov declared that Soviet scientists had to solve
the problem "within three years" in order to begin
exploiting Kansk-Achinsk coal in the Ninth Five-Year
Plan (1971-75). Five years later, Kosygin endorsed
construction of 1,500-kV DC and 1,150-kV AC lines
during the Ninth Five-Year Plan (1971-75). Another
five years later, the directives for the 10th Five-Year
Plan demanded that production of the equipment for
the 1,500-kV DC and 1,150-kV AC systems be
mastered before 1980 but set no targets for a 2,200- to
2,400-kV DC line.
Some high-level energy advisers have evidently be-
come increasingly doubtful that the problem of
superhigh-voltage transmission, especially 2,200- to
2,400-kV DC transmission, can be solved in the
foreseeable future. In 1973, for example, Styrikovich
asserted that "by the beginning of the 1980s" the first
"1,500- to 2,200-kV DC line" would begin operation.
In 1974, however, he pessimistically observed that the
transmission of electrical energy 3,000 to 4,000
kilometers
demands the creation either of superhigh-voltage
DC lines (2,200 to 2,400 kV), or a shift to
fundamentally new methods of transferring elec-
trical energy (cryogenic-resistance or super-
conductive cables, etc.). Neither the one nor the
other task has been solved anywhere in the world
even at small-scale experimental installations,
and it is difficult to guess the period of time
needed and cost of a solution to these problems.
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The Volgograd-Donbass 800-k V DC Transmission line,
the highest voltage powerline in the USSR
Moreover, in the long run, when AESs [Atomic
Electric Stations] and ATETs [Atomic Heat and
Electric Stations] become the foundation of
elecric power for the entire European part of the
country, the mass transport of energy resources
over such a great distance will lose its
immediacy."
By 1975 he was barely mentioning the subject. As
indicated above, his preferred solution to the problem
has apparently been the conversion of Kansk-Achinsk
coal into semicoke and its transportation west either by
rail or pipeline.
Other top-level advisers hope, on the contrary, that the
long-distance, superhigh-voltage transmission problem
can be solved. Their public statements suggest that
Melent'ev, Aleksandrov, and perhaps Kirillin are
somewhat more optimistic than Styrikovich on this
score." In 1977 Aleksandrov declared that he was
"very pleased to announce" that the technical obsta-
cles preventing construction of the 1,500-kV DC
Ekibastuz-Center line had been overcome, making
possible not only the transmission of power from
Kazakhstan to the European USSR, but "in the next
stage" construction of a Kansk-Achinsk-Center line.92
Melent'ev observed in 1977 that transmission of power
from Kansk-Achinsk to the Center over a superhigh-
voltage DC line was a key element in transferring
energy from east to west in the USSR, and that it could
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not be supplanted by railway or pipeline transport or by
the construction of nuclear power plants in the west.
Moreover, Melent'ev suggested, ecological factors
would in time dictate the location of new thermal and
nuclear power plants at a distance from consumers,
making long-distance DC transmission technology all
the more indispensable."
Construction of a special railroad, as indicated above,
has been considered as an alternative to the
transmission of electrical energy from Kansk-Achinsk.
References to the railroad option have appeared for a
decade, often expressed by specialists associated with
railway transport-including Gosplan's Institute for
Complex Transport Problems." This variant has been
mentioned, along with electrical energy transmission
and pipeline transport, by Kirillin.95 As recently as
February 1977 the director of the Leningrad Scientific
Research Institute for Direct Current found it neces-
sary to refute the argument, "wouldn't it be more
profitable to send the fuel by railway?" even in the
context of defending the more tractable Ekibastuz
1,500-kV line.96
Pipeline transportation of Kansk-Achinsk energy has
apparently been pushed especially hard by Shcherbina,
the Minister for Pipeline Construction, by Gosplan
Deputy Chairman Lalayants, and by Baybakov's
energy adviser in Gosplan's State Experts' Commis-
sion, Bokserman, although it has also been supported
by the State Committee for Science and Technology.
The main argument in its favor has evidently been that
pipeline transportation is far cheaper than either long-
distance electrical transmission or railway transport.
Before the 10th Five-Year Plan was adopted, both
Shcherbina and Bokserman publicly supported capsule
pipeline transport, and Bokserman claimed that this
mode was only a third the cost of railway shipment of
coal.
Attention has also been paid to slurry pipeline trans-
port.97 In March 1977 it was announced that a group of
scientists from Donetsk had worked out recommenda-
tions for building a slurry pipeline up to 4,000
kilometers long from Kansk-Achinsk to the European
USSR, which would deliver coal at 10 times the speed
of rail transport and at lower cost. And in September
1977, Gosplan Deputy Chairman Lalayants headed a
slurry-pipeline delegation to the United States.
he Soviets
planned to build a slurry pipeline 2,000 kilometers
long, with a capacity of 75 million metric tons per year.
Such a line would presumably be a test before the
Kansk-Achinsk-Center line was undertaken.98 Before
this pipeline is built, however, an initial experiment
will be made with a 250-kilometer slurry pipeline
designed to move coal from the Kuzbass to a power
plant in Novosibirsk. Preliminary calculations are also
being made on a 25-million-ton-per-year Kuzbass-
Urals line.
Gosplan supported slurry pipelines, Lalayants stated,
in order to promote conversion by industrial users from
oil to coal. It probably supported the project too
because it may well have been convinced by the
deliberations of the joint Gosplan and Academy of
Sciences Permanent Commission on Kansk-Achinsk
that pipeline transport was demonstrably the cheapest
way to move Kansk-Achinsk energy. But there may
have been a personal reason as well. Gosplan Chair-
man Baybakov's son, Sergey, is deputy director of the
institute responsible for designing the slurry pipeline
system, and Baybakov senior is said to have backed the
project to support his son's career ambitions, interced-
ing personally with Kirillin to secure R&D funding for
it.99
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It is apparent that solutions to the problem of
transporting Kansk-Achinsk energy are not imminent.
According to Chukhanov, this situation is explained by
a fixation for many years on oil: "Even in the USSR
Academy of Sciences for 15 years now all the most
important scientific research on solid fuels has been
almost completely eliminated. "110
The notion that Kansk-Achinsk development would
make any significant contribution to the Soviet energy
balance before 1980 was evidently discounted almost
immediately after the five-year plan was adopted-if
not beforehand-by such key figures as Minister of
Coal Bratchenko, Minister of Power and Electrifica-
tion Neporozhniy, and Baybakov himself."' The de
facto strategy that has emerged since 1975 has been to
press ahead on Ekibastuz coal extraction, to assign
priority to design and construction of the 1,500-kV DC
Ekibastuz-Center transmission line, to develop very
gradually the third extraction site in Kansk-Achinsk
(the Berezovo coalfield), and to look in the medium
run toward a linkup of Kansk-Achinsk with the
Kazakhstan power grid by means of a 1,150-kV AC
line-which would permit a roundabout transfer of
Kansk-Achinsk power at least to the Urals until the
Ekibastuz-Center line goes into operation."'
Not surprisingly, discussions of Kansk-Achinsk since
1976 exhibit considerable ambivalence. The decision
in the 10th Five-Year Plan to go ahead with Kansk-
Achinsk, even though the transportation issue re-
mained unresolved, has led some authorities to
redefine the central function of Kansk-Achinsk by
emphasizing its role as the hub of a vast energy-
intensive industrial complex to be formed right in
Krasnoyarsk Kray. This point of view, which has been
publicly articulated by Mazover and Nekrasov of
Gosplan's SOPS, implies an extremely bullish attitude
toward Siberian industrial development, but by the
same token suggests that Kansk-Achinsk coal will not
solve the critical European USSR fuel deficit in the
foreseeable future.103 Meanwhile, others-including
some Gosplan officials-continue to emphasize trans-
portation west of Kansk-Achinsk energy. 104C
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In practice, progress has been achieved in Ekibastuz
during the present five-year plan, and it is claimed that
the technology of 1,500-kV DC transmission has now
been mastered and that actual construction of the line
is about to begin. Reports from Kansk-Achinsk,
however, indicate that while a few broad output targets
have been set, no comprehensive development program
existed at all, even in 1977.105 Despite efforts by the
Krasnoyarsk obkom to generate such a program and to
establish some mechanism for coordinating the activi-
ties of the dozens of agencies involved in developing
Kansk-Achinsk, the familiar pathology of
malcoordination at the regional level has persisted.
Each ministry goes its own way, guided by its own
vested interests, and vital long-term development
needs are simply ignored."' There is no evidence that
the leadership in Moscow was prepared to intervene
decisively in the period leading up to the December
1977 Plenum of the Central Committee in order to
change this situation.
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 Achieving an optimum balance between resources invested in
West Siberia and in the older, more depleted oil regions east of
the Urals.
Development of many small, less accessible and less productive
oil deposits in Tyumen to compensate for declining production
elsewhere and the peaking of the largest Tyumen oilfield,
Samotlor.
Huge investment costs required in production facilities, pipelines,
and infrastructure, given the remoteness and harsh environmen-
tal conditions of Tyumen.
25X1
Soviet Energy Production Alternatives
Maintain or increase the combined share of hydrocarbons in the
fuel-energy balance, with particular emphasis upon oil
production.
Concentrate investment on Tyumen Oblast of West Siberia.
Accelerate oil production in the Middle Ob region and produc-
tion of natural gas in the northern region of Tyumen, while
aggessively seeking new giant oil deposits at lower levels in the
Middle Ob and beneath the gasfields in the north. Rapidly
expand exploration for new oilfields along the Arctic shelf and in
East Siberia.
Proponents A Tyumen-based grouping (the Tyumen obkom first secretary,
Bogomyakov; the obkom second secretary, Shmal'; the chief of
the Tyumen Geological Administration, Salmanov; and numer-
ous lesser Tyumen production-level and institute personnel).
The Ministry of Construction of Petroleum and Gas Industry
Enterprises, led by the former Tyumen obkom first secretary,
Shcherbina.
The Siberian Division of the Academy of Sciences, and especially
its deputy head and director of the Institute of Geology and
Geophysics, Academician Trofimuk.
The head of Gosplan's Council on Production Forces (SOPS),
Nikolay Nekrasov.
Central Committee apparatus officials, with possible support on
occasion from Dolgikh, Kirilenko, and even-perhaps-
Brezhnev.
Problems Failure to discover any new supergiant oilfields in Tyumen and
elsewhere in the USSR.
Uncertainly and controversy over the size of oil reserves
remaining in Tyumen. Insufficient geological exploration in
Tyumen and East Siberia.
Capitalize on the one energy branch in which the available
resource base and level of existing technology could conceivably
permit a relatively rapid increase in output and shift in the Soviet
fuel balance.
Accelerate development of Medvezh'ye, Urengoy, and other
giant gas deposits in northern Tyumen, build the pipelines
needed to transport this gas to consumers.
Make a firm decision that gas should continue to be used as a
boiler fuel as well as a feedstock for the chemical and
petrochemical industries. On the basis of such a decision proceed
to build a series of large gas-fired thermal generating plants in
Tyumen, and transmit the power produced to the Urals and
European USSR over extrahigh-voltage lines.
Shcherbina, the Minister of Construction of Petroleum and Gas
Industry Enterprises.
Tyumen political, economic, and institute officials (the same
group supporting the Hydrocarbon strategy, plus some
individuals in the gas industry).
Gosplan Chairman Baybakov; the deputy chairman of Gosplan's
State Experts' Commission, Bokserman; and Kosygin's energy
referent Popyrin (in the early to mid-1970s).
Some leaders in the Academy of Sciences (notably the head of
the Yakutsk branch of the Academy, Cherskii; to a certain extent
the President of the Ukrainian Academy of Sciences, Paton,
and-in the early 1970s-some of the later supporters of the
Combined Resources approach).
The high cost of pipeline construction and the amount of steel
required to produce a quantum leap in gas transportation.
Hard currency constraints on the purchase abroad of linepipe
and compressors.
Delay in research and development aimed at lowering the cost of
gas transport.
Controversy over pipeline routes, connected in part with tech-
nical difficulties presented by permafrost.
Reverse the trend toward hydrocarbons in the fuel balance
through coal substitution.
Rapidly develop strip mining in the Ekibastuz field of northe
Kazakhstan and, above all, in the enormous Kansk-Achinsk
brown coal deposits of Krasnoyarsk Kray in central Siberia.
A cluster of officials and scientists associated with the coal and
electric power industries (Minister of Coal Bratchenko, Minister
of Power and Electrification Neporozhniy, Academician
Mel'nikov, coal pyrolysis expert, Chukhanov).
Gosplan Chairman Baybakov and head of Gosplan's InstituteI for
Complex Fuel-Energy Problems, Yatrov (to some extent).
Central Committee secretary and former Krasnoyarsk kraykom
Enrichment of Kansk-Achinsk coal to upgrade its
transportability and burning properties.
Transportation of the energy to be derived from Kansk-Achinsk
and Ekibastuz coal: by rail, pipeline, or high-voltage
transmission from mine-mouth generating plants. Investmen
costs of each of these alternatives are enormous, and pipeline r
high-voltage transmission require fundamental research and
development breakthroughs.
Conversion of old power plants and development of a new
generation of equipment capable of efficiently burning Kans
Achinsk coal.
Development of a new center of energy-intensive industry in
Krasnoyarsk Kray based on Kansk-Achinsk coal.
Adopt an integrated approach to research, development, and
exploitation of all basic energy sources, aimed at cost optimiz-
ation of energy production.
Pursue a resource allocation pattern intended to guarantee a
timely shift in the energy balance toward coal and conventional
fission power in the midterm, and then breeder reactors, and
(finally) fusion power in the more distant future.
Exploit the USSR's comparative international energy advantage
by means of hydrocarbon exports, but reduce foreign technologi-
cal dependence and ensure long-run energy self-sufficiency based
on coal and nuclear power.
Virtually the entire top level of the Academy of Sciences' energy
experts: President of the Academy Aleksandrov, Vice President
Velikhov, Styrikovich, Melent'ev, and Mel'nikov.
Chairman of the State Committee for Science and Technology
and Deputy Chairman of the Council of Ministers Kirillin.
Gosplan Chairman Baybakov and head of Gosplan's Institute for
Complex Fuel Energy Problems, Sergey Yatrov.
Minister of Coal Bratchenko and Minister of Power and
Electrification Neporozhniy.
The high cost of advancing simultaneously along the entire
energy front.
Potentially inadequate responsiveness to the immediate need for
oil and gas.
All the difficulties enumerated above related to the exploitation
of the Ekibastuz and Kansk-Achinsk coal deposits.
 21
125X1
Confidential
USSR: Major Petroleum Deposits, Pipelines, and Coal Basins
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504002 1-79 (543733) 93 Confidential