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News James Balaschak, BSCE ’75

From His Office Overlooking the Kremlin, This Alumnus is a Witness to Russia in Transition

Growing up in Johnstown, Pa., Jim Balaschak never knew exactly where his future might take him. Of all the places he might have pictured, Moscow would have been among the least likely. For more than a decade, though, this former center of the Soviet empire has been his home, and he has had a front-row seat in witnessing the dramatic transformation of Russia.

While living overseas can involve difficult adjustments anywhere, Moscow was just a few years removed from the collapse of the Soviet Union when Balaschak and his wife, Kim, arrived there in 1995.

"We literally starved," Balaschak recalled. "We lost more than 15 pounds each. There were no supermarkets; we survived on root vegetables, frozen chicken legs, and pasta, and we could not get cat food or kitty litter. But Moscow today is a totally modern capital, with sushi bars and coffee shops on every corner… you can get anything you want now."

Balaschak works for the global professional services firm Deloitte & Touche, providing consulting as well as audit-, tax-, and financial-advisory services. He serves as managing partner in charge of consulting for Deloitte & Touche CIS (Commonwealth of Independent States). He also serves as the CIS firm's energy and resources leader. His portfolio includes TNK-BP, a joint venture between BP and three Russian shareholders. This venture includes Russia's second-largest oil and gas company and the world's eight largest private oil and gas companies, which collectively employ more than 100,000 and produce approximately 2 million barrels of oil daily.

Deloitte & Touche first opened a joint venture in the Soviet Union in 1989, two years before that country splintered into 15 independent nations, including contemporary Russia.

With energy demand a critical political and economic issue around the world, Russia is being looked to as never before to meet those global needs, Balaschak noted. "There are tremendous undeveloped resources in the Russian far East, West, and in East Siberia," he said. "Plus, the Arctic region is untapped. Russia has the potential to more than meet all of the world's demand growth over the next 10 years."

As energy companies in Russia grow, Balaschak said, his company brings financial transparency through audit and internal-controls services. "We also help Russian companies employ best practices in people, processes, and technology to achieve operational excellence and maximize return on assets and capital," he added. During the past five years, Deloitte & Touche also has advised dozens of U.S. and multinational companies seeking to enter the markets in Russia and the CIS.

Being widely recognized as an expert on Russian business issues makes Balaschak a valuable person to know, plus he plays an active role in the 800-member American Chamber of Commerce in Russia. He chaired the chamber's board of directors in 2000–01 and hired the group's current president. "My role as chairman was a lot of fun. I got to meet U.S. presidents, congressmen and senators, cabinet members, and Russian business and government elite," Balaschak remembered. He received the Chairman's Award in 2002 for his contributions to the Chamber's work and was recognized as Chamber Member of the Year in 2005 for his leadership role in promoting trade between Russia and the United States.

Although his role today places Balaschak on the white-collar side of the energy business, he knows just how dirty, dangerous, and complex the operations of the oil and gas industry can be. After focusing his civil-engineering studies at Pitt on structural engineering and earning his bachelor's degree in 1975, Balaschak landed his first job with Lee C. Moore Corp. in Tulsa, Okla. "They designed and built drilling structures for the oil and gas industry and had the largest market share at the time," he said. "The company was family-owned, and the president and vice president were Pitt grads and recruited there." The experience was great, Balaschak said, adding that he had the opportunity to design the largest drilling rig in the world at that time and experienced the harsh working environment where many of these rigs operated. For the uninitiated, Balaschak suggests, "Try climbing up a 150-foot drilling rig in West Texas with the wind blowing 50 miles an hour!"

A solid engineering background has been invaluable to his career success, according to Balaschak. Prior to joining Deloitte & Touche, he was managing director at Teledyne Technologies Inc., a major U.S. technology company active in many sectors, including metals, aerospace, and industrial and consumer goods. In this role, he was responsible for all of the company's operations, business planning, and expansion activities throughout Russia and the CIS.

"Engineering allows you to better understand the physical world. Many of the things I take for granted, I see people around me struggle to understand," said Balaschak. His success in Russia may also be attributed to his effort to blend in with the national culture. He and his wife both speak Russian fluently, and he served for several years on the board of the Chamber Orchestra Kremlin. Balaschak's wife also is noted for a unique hobby—she has assembled the world's largest collection of Russian Christmas and New Year's tree ornaments, extending from the years preceding the 1917 revolution to the 1960s. The collection was displayed in a major exhibition.

A golfer, Balaschak is working to make the sport popular in Russia. He is a member and past chairman of the Moscow Country Club, the only golf course in all of Russia—for the moment. More than 50 more Russian courses are in the works, and one designed by Jack Nicklaus is scheduled to open next year.

Balaschak has taken the knowledge he learned in Pitt's engineering school far beyond his boyhood confines of Western Pennsylvania. His adaptability is well suited to a life in fast-changing Moscow. "We have learned to be patient," he said, "since here, the unexpected is the norm."

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