Russ Oil-Gas

MOSCOW, July 6, 2009 - (UPI) - Excessive spending on reserves and acquisitions in a poor economic climate could overextend Russian energy giant Gazprom beyond profitability, trends suggest. Despite modest energy prices and a lingering economic recession, Gazprom last week moved on a deal with Azerbaijan to tap the massive Shah Deniz field that has more immediate political ramifications than energy benefits. Europe eyes Shah Deniz as a major source for its Nabucco gas pipeline, which sidelines Russia. The Gazprom deal could undermine Nabucco and European efforts to diversify the regional energy sector, though Baku said it has a diverse client portfolio. At a rate of roughly three acquisitions per month, Gazprom has spent close to $70 billion on mergers, ranging from Russian newspapers to rival energy targets. Gazprom through its various operations and global ventures holds more gas than its customer base supports. The company in 2008, meanwhile, requested $1 billion in government loans to refinance its debts while expressing concerns over the ability to attract new loans. Its bullish behavior in a bear market has prompted minority shareholders, for their part, to express concerns over any decisions that could result in minimal payoffs, The Wall Street Journal reports.