Russian Companies Directly Supporting Putin’s War

The Jamestown Foundation | Kassie Corelli

Novatek, Russia’s largest independent natural gas producer accounting for 12 percent of domestic extraction, has been directly integrated into Moscow’s war effort in Ukraine through state-mandated military recruitment. Following initial anti-war statements in March 2022, the energy firm established the Courage foundation in September 2022 to provide bonuses of at least 200,000 rubles ($2,449) to military recruits signing contracts with the Russian Ministry of Defense.

Loyalty bought state support. The Russian government rewarded this coordination in April 2023 by zeroing the mineral extraction tax on Arctic gas for ammonia and hydrogen production, boosting Novatek's net profits by 7 percent in 2024. However, central political subordination has severed critical international partnerships. U.S. sanctions imposed in November 2023 on the Arctic LNG 2 project forced French, Chinese, and Japanese shareholders to suspend financing obligations, culminating in a European Union ban on Russian LNG in October 2025.

Comment

The subordination of nominally private energy firms into the Kremlin's manpower machinery reflects a command relationship where corporate governance is directly subsumed by military authority. By channelling recruitment bonuses through entities like the Courage foundation, executive management yields administrative autonomy to the Russian Ministry of Defense. State control is maintained not through nationalisation, but through directives that link commercial survival to military enlistment targets.

This command structure mirrors the operational framework enforced by the Soviet State Defense Committee during the Second World War, when industrial enterprise leadership was integrated into centralized mobilization hierarchies. In both cases, Novatek and its wartime predecessors ceased operating as commercial entities, functioning instead as administrative arms of Moscow's military apparatus.

Strategic Question for Discussion

Which factor presents a greater long-term constraint on state control over energy executives — the threat of asset nationalisation or the systemic loss of Western technology partnerships suffered by firms like Novatek?

The evidence indicates that the loss of Western technical capability represents the more severe structural bottleneck for state-directed energy enterprises. While internal coercion secures immediate compliance and manpower funding for the Russian Ministry of Defense, stripping firms like Novatek of foreign capital and specialized LNG technology degrades the long-term revenue base that sustains state subsidies. Consequently, short-term military coordination directly undermines the broader industrial capacity of the state.

Share your assessment in the comments below.

Read the original article