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Monday, October 15, 2007

Gas Blast Kills 23 in Dnipropetrovsk (Last Updated Oct. 20)

A natural gas explosion on Saturday, Oct. 13 took the lives of 23 high-rise dwellers, seven of them children, in Dnipropetrovsk, Ukraine’s third-largest city. (Rescue efforts ended Friday, Oct. 19.)

The explosion blew apart an entire section of the 10-storied condo complex, leaving more than 70 people injured. The shock wave has damaged neighboring buildings. According to preliminary findings, the accident was caused by the utility company’s negligence. Two company employees have been arrested.

PM Viktor Yanukovych, who came to ground zero, did not receive a warm welcome. Eye witnesses claimed that the fire engines summoned to the scene had lacked the fuel to extend their turntable ladders, a drag on rescue efforts at a time when every second counted. The victims surrounded Yanukovych and demanded that he sign a written obligation to reimburse them for their loss, Ukrayinska Pravda reports.

Local authorities have vowed to provide replacement apartments to all victims.
BYuT leader Yulia Tymoshenko, a native of Dnipropetrovsk, has also visited the site of the tragedy. President Yushchenko has declared Tuesday a day of mourning.

I just watched Channel 5, and they said that people had been calling Dniprogaz, the utility company for two days, asking them to fix the broken gas valve. No response. Now you know
what it takes to grab the utility company's attention in Ukraine. A total of 5,200 buildings were cut off from the gas supply.

The accident was followed by days of silence from Dniprogaz stockholders, the most prominent of which is Viktor Vekselberg. His Gazeks company, which controls Dniprogaz, is offering a payment of 500,000 hryvnias ($100,000) to every family, without accepting blame for the accident "until proven otherwise."

Gazeks is in turn owned by Renova, a company that positions itself as "Geography of Responsibility. Ideas, (sic) that shape the course of history."

Photos courtesy of Natalia Kovalchuk of AFP

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Anonymous said...

payment of 500,000 hryvnias ($100,000) to every family - you could purchase an apt. but not a great one (or centrally located) for that price (I think) but it would be a windfall for the residents. I wonder what documentation they would have to sign.

(I wonder about the other gas explosions that happened this year (and every year) in which people die/d with no pay off.)


Taras said...

Not even a million dollars would compensate for the loss of a loved one, and for the emotional distress of having one’s family nest destroyed.

So far, nobody has accepted responsibility for the accident. No payouts have been made. Talk about Tylenol and Exxon Valdez.

Anonymous said...

Керівник Дніпрогазу потрапив у ДТП

Head of Dniprogas in car accident - he was the driver - unhurt but his passenger was injured and went to hospital.

Yikes this guy is dangerous! but kinda bound to happen eventually based on how esp. the nouveau riche drive.
I agree about the monetary compensation in that it really is not compensatory at all but am amazed by it even being offered - is this the first time such an offer has been made to victims of a gas explosion? (I know that it is 99.9% probably pr stunt and no one will ever see anything of it.)


Anonymous said...

Correction to the last post - the aid is being paid out but that is according to moscow radio - but still it is amazing. Will this herald a new dawn of corporate responsibility in Ukraine?


President of Ukraine Victor Yushchenko discussed with Russian businessman Victor Vekselberg the issues on compensation payment to victims of gas explosion in Dnipropetrovsk.

Russian entrepreneur Victor Vekselberg starts payments of pecuniary aid to families of perished people and victims as a result of gas explosion in Dnipropetrovsk, reports “Echo of Moscow” radio station.

Taras said...

Ukrainians’ driving culture is one of the deadliest in Europe. The more cars, the more carnage.

Still, this particular road accident seems rather mysterious, given the weight of the circumstances. What if they’re “cleaning house?”

Yes, compared to the victims of similar gas accidents in the past, these people are “lucky.” With publicity on their side, at least they will get something. I hear that Akhmetov and Pinchuk have made sound contributions.

The scale of the tragedy makes the shake-em-off/business-as-usual scenario unlikely.

Taras said...

The initial response, as noted by President Yushchenko in his nationally televised address, was highly inactive. It has now entered the reactive stage.

If I were to write a case study on this accident, there would be no getting around these sorry-assed facts. The “Geography of responsibility” brand sounds like the most sordid of sloganisms.

I believe that Gazeks will pay a certain sum. I also hope that others will learn from Gazeks and will move closer to Johnson & Johnson.

Anonymous said...

Amen! a cure is needed! Luida
Cure needed, not relief
by Editorial , Kyiv Post
Oct 24 2007, 21:47

The tragedy of the Dnipropetrovsk natural gas explosion has reminded the country and the world that 16 years into its independence Ukraine still suffers from an inefficient and often deadly Soviet-era infrastructure. But responses to the tragedy show that officials and businessmen still suffer from a Soviet mindset. The central government was right to step in with Hr 94 million (nearly $19 million) and everyone who made donations, from Lviv to Luhansk, should be commended.

But President Viktor Yushchenko had to personally go to Dnipropetrovsk and shame local officials and owners of the company Dniprogaz before they even suggested bearing responsibility for the tragedy.

In the end, Ukrainian-born Russian billionaire Viktor Vekselberg said that his structures would pay out $100,000 to each of the families of the 23 people who perished in the tragedy, while surviving victims (18 of whom were still in hospital on Oct. 22) would split an additional $5 million, according to Ukrainian media reports.

The president also had to ask the businessman to restore natural gas service to all 5,000 buildings that had their supplies cut off as a result of the accident. Yushchenko is right in talking about utility concessions to businesses – market players will be more interested in making utilities efficient and safe, especially if they carry liability.

The country’s opaque energy sector needs greater transparency. Massive profits are earned by obscure offshore entities that feed like parasites on the dilapidated state infrastructure. They rarely re-invest in the Soviet-era gas network.

In the short term, the state should consider breaking up privately-owned monopolies of the energy distribution networks. Instead, investors should be lured to produce more energy in the country and offered the chance to sell it down the chain on a transparent market with bidding, such as seen on energy markets in Europe.

When this happens, and a proper corporate culture is established, the state can tender off management of its natural monopoly infrastructure to private interests capable of managing it better.

The solution is in fixing the system, not providing relief: No matter how big the bandages are, they will not return the lives lost on Oct. 13.

Taras said...

KP is right on target.

First of all, the victims must be compensated for their loss. From that point on, we need reform, not relief.

We need core changes, not cosmetic ones.