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Excerpts from transcript of meeting with Government members

President of Russia Vladimir Putin: Good afternoon,

On our agenda today are matters concerning preparations for the World Cup [2018] and WorldSkills competition [2019]. These are the main items on the agenda today, but before we start, I want to hear a few words from you on some other very important matters.

First, work continues on carrying out the infrastructure development programme, including airport construction. One of the planned sites is the Anapa airport. They already have a dual-purpose airport there with a good runway, but a new terminal needs to be built. This is a very advantageous site, after all, once work on the bridge connecting the Caucasus region to Crimea is finished, passengers will be able to arrive quickly via this airport to Crimea’s eastern coast, and travel onwards to destinations in the Caucasus itself, of course, Anapa, Novorossiysk and Gelendzhik.

Mr Sokolov, how is this work going?

Transport Minister Maxim Sokolov: Mr President,

As it happens, we launched the works on Anapa’s new airport terminal just yesterday. The terminal area will be 12,000 square metres – 2.5 times bigger than the current terminal. This will make it possible to offer tourists and holidaymakers all the proper comfort and improve the logistics and communications situation with regard to Crimean Federal District.

The airport is growing rapidly. It served 17 percent more passengers last year than in 2014, and the figures for January this year already show growth of nearly 30 percent.

We expect the new terminal to be complete by the end of this year, and it will be ready to open its doors to all holidaymakers and tourists starting from the next holiday season.

This is certainly not the only site that will be ready for operation this year. The Transport Ministry and investors are investing actively in airport infrastructure and a number of new facilities are due to open soon.

The modernised airport in Petrozavodsk, Karelia, began operations at the start of January. A new airport terminal is just weeks away now from starting work in Nizhny Novgorod, and a new airport that will add a fourth civilian airport to Moscow’s aviation hub (the Ramenskoye or Zhukovsky airport) is also set to start work this year, which will considerably increase the Moscow air transport hub’s passenger throughput capacity.

This year will also see the opening of new airport terminals in Tyumen (Roshchino airport), Volgograd, and Kaliningrad, and a new airport will open in Petropavlovsk-Kamchatsky after large-scale reconstruction.

Work has begun on building new terminals in Krasnoyarsk and Perm, and modernising Tyva airport. Construction will get underway in May this year of a new terminal in Simferopol, with capacity of 7 million passengers. Incidentally, last year’s passenger figures put Simferopol’s airport in fifth place in the country, immediately after Moscow and St Petersburg, with more than five million passengers.

This work is possible because we have not just direct investment coming from the federal budget, but also because these projects have become more attractive for investors and we now have several investment groups taking part in the work to develop airport infrastructure. Several runways were built entirely on investors’ money, at the Talakan airport, for example [in Yakutia], and the Bovanenkovo and Sabetta airports on the Yamal Peninsula.

Of course, the five programmes for supporting regional air transport that the Transport Ministry is carrying out today on the Government’s behalf aim, among other things, to develop domestic tourism too.

Vladimir Putin: On the subject of domestic tourism, we already have the preliminary results for last year and the forecasts for this year. Mr Safonov, what are the results?

Head of the Federal Agency for Tourism Oleg Safonov: Mr President,

Preliminary results for the 2015–2016 winter tourism season show that tourist flows increased by 10 percent for the country as a whole. At the same time, we see that regional tourism infrastructure is being put to effective use and demand is high.

The regions with the largest inflows of domestic and foreign tourists are Moscow, St Petersburg, and Krasnodar Territory, of course, including Sochi. But we also have Kemerovo, Altai Territory, and the North Caucasus republics. In other words, all the different destinations are popular and in demand.

We have already started preparing for the high season in 2016. The main task is to provide tourists with high quality and affordable holiday options. As part of this work, we are developing and expanding package tour offers here in Russia and expanding the programme of charter flights. We are also working on subsidised transport for organised tourist groups visiting our country’s main tourist destinations.

Our tourism centres are already prepared for the high season. The main destinations are ready. This includes Crimea, Krasnodar Territory, the North Caucasus republics, and the Siberian regions.

We are working actively on developing the tourism infrastructure right now. As part of the federal targeted programme for developing domestic and foreign tourism, 21 supporting infrastructure facilities in 10 different regions were completed last year, and 13 tourism infrastructure facilities in eight regions.

There is still a lot we could do to develop the high tourism season’s full potential. To do this, we are working on promoting various additional forms of tourism, in particular, health resorts, sports, cultural and educational tourism, and also eco-tourism, ethno-tourism and other tourism activities.

Vladimir Putin: This is all very timely work given that tourism flows are increasing and infrastructure, including airports, continues to develop. I hope that these plans will all be carried out on schedule.

Mr Donskoy, as you know, I met yesterday with the heads of our biggest oil companies and we reached an overall agreement on freezing oil production levels in 2016 at the level we had in January this year.

In this respect, what is the current situation with support measures for geological exploration?

Natural Resources and Environment Minister Sergei Donskoy: Mr President,

In the current circumstances on the global energy market, we have seen a drop in companies’ geological exploration activity. This is a natural trend and globally, there was a decrease of 22 percent in hydrocarbon geological exploration work last year.

In this respect, acting on your instruction, we will support this sector of activity by extending the application principle to hydrocarbon fields. This will simplify substantially the procedures for licensing fields where oil and gas reserves have not yet been discovered.

Currently, the application principle is used only for exploration of solid minerals. In the two years since we introduced this procedure, subsoil resource users have made 746 applications to carry out high-risk geological prospecting work. So far, 305 licences have already been issued based on examination of the applications. Before we introduced this procedure, only 25 licences a year were issued, so there has been a considerable increase. Now, Rosnedra [federal subsoil resources agency] receives up to 60 new applications a month. In other words, despite the current difficulties, companies want to carry out geological exploration, but they want simplified procedures in this area.

Over the period from 2013 to 2015, Russia’s share in total world investment in geological exploration of solid minerals increased by more than 50 percent. This figure is for solid minerals. Let me say too that the investor profile of companies carrying out geological exploration using the new procedure includes big companies such as Norilsk Nickel, ALROSA, Polymetal, foreign companies, such as Kinross Gold, and also small and medium-sized companies that are willing to take the risk, explore the lots and develop them. This is important, particularly in terms of supporting small and medium business in the geological exploration sector.

As I said, we plan to extend this application procedure to geological exploration for hydrocarbons, and will expand it for inferred high-category resources, the R1 and R2 resources. This procedure will thus cover all different types of mineral resources. Currently, the procedure for solid minerals applies only to fields where the resources fall under very low categories and there is little more than a suspicion that mineral resources are indeed to be found there. We want to extend the system to higher-category resources in order to attract more players.

We also plan to introduce restrictions on the maximum area that can be used for subsoil resource development, and the maximum number of lots any one applicant can claim, so as to increase the overall number of players and boost competition.

We think this will offset the drop in investment in geological exploration work brought about by the macroeconomic situation. The specialists say too, that this could increase investment in exploration of new fields by up to 30 percent. We think this would be a good incentive that could ensure stable support for geological exploration in order to maintain stable production levels.

Vladimir Putin: Good. Thank you.

Mr Dvorkovich, as you know, I spoke yesterday with the head of the service responsible for studying the technical causes of the tragic accident in Vorkuta. You head the government commission. What is the situation with support for the people affected by this tragedy and for the families of the miners who were killed?

Deputy Prime Minister Arkady Dvorkovich: The government commission has organised measures to support the families of the miners and rescuers who were killed or injured. This work involves several different channels.

(Mr Dvorkovich went on to describe the financial payments made to the families of those killed or injured, and provision of medical and psychological help).

Finally, one other area of work that will be essential over the coming months is finding new jobs for the mineworkers because the mine will not be operating in the coming months. Most of the miners will be taken on at other mines in Vorkuta, and some will be offered jobs in other places. In any event, regardless of their job situation, all of the miners will receive their full salary over the next few months. If needed, we will make use of the federal job support programmes available. Money has already been set aside for these needs.

Vladimir Putin: How many people currently work at the mine?

Arkady Dvorkovich: In total, around 1,000 people work there, of which around 800 work down in the mines and around 200 work above ground.

Vladimir Putin: You know that the preliminary report from Rostechnadzor [federal technological safety regulator] has not found any technical safety violations.

Arkady Dvorkovich: No violations that could be directly responsible for the accident.

Vladimir Putin: Yes, no violations that could have caused it…

Arkady Dvorkovich: There were individual violations, but they are not linked to the accident.

Vladimir Putin: Yes, the investigation has found no violations that could have caused the accident.

Nevertheless, the mining was done using a quite specific method there, a method that was also considered the safest, incidentally, but still, we need to examine very thoroughly whether this could not have caused movements in the rocks that ultimately set off this terrible tragedy. We need to analyse once again all possibilities for ensuring safety in general and warning the miners in the event of unfavourable conditions. In this case, events developed very quickly, in just a few seconds after the energy supply shut down. It’s not very clear what would have been the best course of action in this situation, and was there even time to react.

We therefore need to make a thorough analysis of all of this. It would seem that we have already taken so many measures in this area to ensure safety, and yet we still find ourselves facing this terrible tragedy now in Vorkuta at the Severnaya mine.

I ask you to analyse everything with the specialists. Rostechnadzor has scientists working on this now. Once this thorough analysis is complete, I ask you to draft proposals on improving safety at our mines.

Arkady Dvorkovich: Mr President, this work has been organised. Rostechnadzor has brought in scientists and leading specialists in the area, and so has the Technical Committee, which is working at the site and brings together the efforts of the mine operator itself, the investigative agencies, Rostechnadzor, and Rosprirodnadzor [federal environmental regulator]. Specialists from St Petersburg, Moscow and the Kuzbass region have gone there. The analysis is underway and a whole range of factors is being examined.

Many measures were taken following the accident at the Raspadskaya mine in 2010, which also caused large loss of life. Our experience over the following years shows however, that this is still not enough and we need to take further measures. In this, we can draw on international experience too, where safety standards are also very high, but sadly, accidents with considerable loss of life also occur.

Vladimir Putin: You need to look at the technical side of things. The production method used at that mine was considered the safest method in the world, and yet this accident has occurred.

Arkady Dvorkovich: The preliminary proposals will be ready by early April and will be examined at the meeting planned with Prime Minister Dmitry Medvedev.

Vladimir Putin: Good.

You need to pay particular attention to the families where there are now underage children who have been left without their fathers.

Let’s move on to the main items on our agenda.

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