Russia’s Gazprom Chief Is Ousted

One of the gnarled dinosaurs of Russia’s gas industry, Rem Vyakhirev, was ousted Wednesday as chief executive of Gazprom in a sign of the Kremlin’s determination to reform the nation’s largest company.

The Gazprom board of directors voted Vyakhirev out of the position he had held for nine years, replacing him with an ally of Russian President Vladimir V. Putin.

The move was orchestrated by the Kremlin and signaled its intent to bring the gas company, which is 38.4% state-owned, more firmly under its control. Gazprom is often called a state within a state for its secrecy and lack of accountability.

Vyakhirev and his allies ran the company like a private fiefdom amid allegations of insider deals, shabby treatment of minority shareholders and management figures siphoning off millions of dollars to benefit relatives.

The company accounts for 7% of Russia’s economy and 20% to 25% of the government’s budget revenue. It meets a quarter of the gas demand in European Union nations.

Complaints about the company’s management had reached such a level in recent months that the Kremlin would have been perceived by Western investors as not fulfilling promised reform had it failed to oust Vyakhirev. The shake-up followed Putin’s call last month for more transparency at Gazprom.

The board meeting Wednesday capped weeks of frantic maneuvering as Vyakhirev sought to avoid dismissal. The board elected Deputy Energy Minister Alexei Miller as the new chief executive. Miller served with Putin in the St. Petersburg mayor’s office in the 1990s.

“No Russian company has been marked by such mismanagement, asset transfers and nepotism as Gazprom,” said Steven Dashevsky, senior oil and gas analyst with Aton Capital Group, a Russian investment company.

He said Gazprom had been run inefficiently and not in the interests of investors. The government is the largest shareholder.

Despite this, Prime Minister Mikhail M. Kasyanov promised Wednesday to recommend Vyakhirev for a state medal.

The reform of Gazprom and another energy giant, the electric power company UES, is seen as key to Russia’s economic health.

“If the Putin administration wants to prove to the world that they’re committed to making changes that will actually lead to sustainable growth in the economy, these two had to be addressed,” Dashevsky said.

Critics have attacked the transfer of assets and customers from Gazprom to Itera, Russia’s second-largest gas company, which was created in 1992.

Amid widespread speculation that it was at least partly owned by Gazprom managers, Itera recently released a list of shareholders. But the disclosure revealed little: 75% of shares are under trust management, concealing the identities of beneficiaries.

“When you entrust someone with the management of Russia’s largest company and there is well-documented evidence of assets being transferred from Gazprom, gas customers being transferred from Gazprom to Itera, relatives of senior Gazprom managers receiving for free pieces of equity in attractive joint ventures, you clearly have indications that somebody is abusing their power,” Dashevsky said.

“At the same time, you have a company [Gazprom] that is complaining of lack of funds for investment,” he said.

Critics of Gazprom have called on the company to provide a more transparent management, revise the partnership with Itera, end barter deals, separate gas shipping from production, and pave the way for the emergence of private gas producers.

Dmitri Vasilyev, director of the Institute of Corporate Law and Corporate Governance, said rumors of Vyakhirev’s removal had been circulating for years. However, Putin’s predecessor, Boris N. Yeltsin, did not have the stomach to make the move and to undertake a major restructuring of Gazprom, he said.

“Putin’s move to replace Vyakhirev will have a very profound positive influence on the economic image of Russia and its reputation worldwide,” Vasilyev said. “Today’s change in Gazprom is a sign of the president strengthening his control of the nation’s major industrial giants.”

Gazprom share prices on the Moscow stock exchange surged on the news of Vyakhirev’s removal. Alexei M. Ryzhikov, vice president of the exchange, said the company’s shares were up 4% by the end of trading.

“The CEO issue had up until today remained the last negative point connected with the company’s name. Today, it has been resolved and the market has reacted positively,” Ryzhikov said.

Alexei V. Kuznetsov of The Times’ Moscow Bureau contributed to this report.