Category Archives: Central Asia & South Caucasus News

Kazakh energy ministry forecasts Kashagan production

DEC. 14 2016 (The Conway Bulletin) — A report from Kazakhstan’s energy ministry forecast total production at Kashagan to reach 308m tonnes in total by 2041, the KazTAG news agency reported. This is important because it shows the size of the oil field and just how much oil the consortium developing it can expect to produce during the lifespan of the production sharing agreement. ENI, Shell, Kazmunaigas, Inpex, Total, ExxonMobil and CNPC are the consortium members.

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(News report from Issue No. 309, published on Dec. 16 2016)

China completes power plant refit in Tajikistan

DEC. 9 2016 (The Conway Bulletin) — China completed the $350m refit of a power plant outside Dushanbe that is considered vital to generating electricity for Tajikistan’s capital city. The refit of the power station highlights just how powerful China’s has become in Tajikistan. It has replaced Russia as the mainstay of the economy. Electricity is important in Tajikistan because its cities suffer from blackouts throughout the year.

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(News report from Issue No. 309, published on Dec. 16 2016)

Tethys’ Kazakh subsidiary resumes sales

DEC. 12 2016 (The Conway Bulletin) — London-listed Tethys Petroleum said its Kazakh subsidiary had restarted gas sales to the state- owned distributor Intergas Central Asia after a seven-week suspension. Intergas Central Asia cut the gas supply contract with Tethys Aral Gas in October. At the time, Tethys was locked in a row with Kazakh investors who had promised to deliver a cash injection.

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(News report from Issue No. 309, published on Dec. 16 2016)f

 

 

Tajik President visits Sri Lanka and India

DEC. 12/13 2016 (The Conway Bulletin) — Tajik President Emomali Rakhmon travelled to India and Sri Lanka to drum up political and economic support. India has redeveloped the Ayni airbase near Dushanbe and there has been on-off talk of the Indian air force taking over running of the base.

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(News report from Issue No. 309, published on Dec. 16 2016)f

 

Georgia unveils budget for 2017

DEC. 15 2016 (The Conway Bulletin) — Georgia’s government unveiled a budget for 2017 that increased taxes on cigarettes, cars, alcohol and oil products to offset a planned drop in corporate tax and a rise in social spending. The increase in spending is designed to propel Georgia through a deep economic downturn. The ministry of labour, health and social affairs, by far the most heavily financed government ministry, will get a boost of around 6% and the budget for the ministry of infrastructure and regional development jumps by a third.

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(News report from Issue No. 309, published on Dec. 16 2016)

Georgia’s CBank maintains rates

DEC. 14 2016 (The Conway Bulletin) — Georgia’s Central Bank slowed its interest rate cuts by keeping its key rate steady at 6.5% at its latest rate fixing meeting. It said that an increase in excise taxes and external factors would help lift prices temporarily although, there- after, price pressure will return. Inflation in Georgia stands at 0.2%, far below the Central Bank’s 5% target. It has cut its key interest rate from 8% at the start of the year.

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(News report from Issue No. 309, published on Dec. 16 2016)

 

EBRD gives loan to Armenian bank

DEC. 15 2016 (The Conway Bulletin) — The EBRD sent a $10m loan to Ameriabank, Armenia’s largest bank by assets, to promote credit to women-led small and medium enterprises. The EBRD also sent a $3b loan to ACBA-Credit Agricole Bank, one of the largest lenders to Armenia’s agriculture sector. The loan is part of the EBRD’s Women in Business programme, which includes Armenia, Azerbaijan, Belarus, Georgia, Moldova and Ukraine.

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(News report from Issue No. 309, published on Dec. 16 2016)f

Tajik President flies to India for 5-day visit

DEC. 16 2016 (The Conway Bulletin) — >> Why is Tajik president Emomali Rakhmon in India? Is this just another meet and greet trip or something more significant?

>> It’s a five day trip starting on Dec. 14, so the length gives away some of the importance. He’s timed it nicely if he wanted to watch the final cricket test match between India and England down in Chennai, but I don’t think that’s why he’s there. Instead Rakhmon and Indian PM Narendra Modi will hold talks aimed at boosting bilateral relations. For India, Tajikistan has been groomed to be something of a springboard into Central Asia. For Tajikistan, India is a potential major investor.

>> I can understand why Tajikistan wants India as an investor, it must need a counterbalance to China’s growing influence and also to Russia, but why does India need to be in Central Asia?

>> India has been late getting in on the act in Central Asia. Whereas China, its great Asian rival, has developed now fairly substantial political and business ties, India has appeared flat-footed. Central Asia is an energy and mineral rich region virtually on its door- step but India simply hasn’t been able to develop any major footholds. Take the energy sector. India needs more energy supplies, so this is important to Delhi. When ConocoPhillips wanted to sell its 8.4% stake in the Kashagan oil project in the Kazakh sector of the Caspian Sea in 2012, it negotiated a deal with India’s state-owned ONGC. This was to be ONGC’s chance to buy into one of the most highly prized pieces of energy real estate in the world. It didn’t work out, though, as Kazakhstan exercised an option that it had on the field and pushed the stake towards China. China’s CNPC ended up buying it for $5b in 2013. India was left looking impotent.

>> That’s certainly a major snub, especially if India has already agreed the deal. What has India done since then to get back into the Central Asian region?

>> It’s been busy. Modi toured all five Central Asian states in 2015. It was a whirlwind tour to each of the region’s capitals and was generally considered a diplomatic success. And India has develop some major projects since losing out on the Kashagan stake. The biggest of these is the TAPI gas pipeline running from Turkmenistan, across Afghanistan to Pakistan and India. It’s an ambitious multi-billion-dollar project that will change the dynamic of the region. Suddenly a major infrastructure project is flowing north-south rather than west-east.

>> So where does Tajikistan fit into all this?

>> India’s interest in Tajikistan is more strategic than obviously economic. In 2003, India upgraded the Ayni airbase outside Dushanbe. The theory was, back then, than it was going to station its air force at the airbase but this never came about. When Modi was in Tajikistan last year he visited the base but no deals were agreed, at least publicly. Earlier this year, the members of the influential China and Russia led Shanghai Cooperation Organisation voted in India and Pakistan as members. Tajikistan has been an important ally for India in helping it secure this.

>> Right. What else is likely to come out of Rakhmon’s visit to India this week?

>> It’s difficult to say for sure. This is Rakhmon’s sixth trip to India but his first since 2012. Indian media have speculated that there will be an upgrade of Indian-Tajik relations and that there could be some movement over the Ayni airbase but a pre-visit statement from the Indian ministry for external affairs was tight-lipped.

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(News report from Issue No. 309, published on Dec. 16 2016)

Russia argues with Georgia over gas

DEC. 15 2016 (The Conway Bulletin) — At a meeting in Vienna on Dec. 13, Gazprom chiefs told Georgia that a long-standing deal by which it could take a 10% chunk of gas that Russia exports to Armenia via Georgian territory should be scrapped, Georgian energy minister Kakha Kaladze told media. The two sides held similar negotiations last year. Russia wants the gas deals to move onto a monetised basis, Georgia wants to swap deal to remain. Last year a swap deal was retained.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 309, published on Dec. 16 2016)

Georgia Global Utilities issues 30m lari bond

TBILISI, DEC. 12 2016 (The Conway Bulletin) — Georgia Global Utilities (GGU), a subsidiary of London-listed BGEO Group, issued a 30m lari ($12m) bond, giving investors the chance to take a punt on the lari.

The bond, destined to GGU’s subsidiary Georgian Water and Power, offers a 3.5% premium over the Central Bank’s lari refinancing rate and will mature in five years.

The lari has slid by 15% in the past three months against the US dollar and is now trading at 2.66/$1. This prompted the Central Bank to stop easing its monetary policy and to keep interest rates stable at 6.5%.

Despite the fall in the value of the lari, BGEO was bullish about the issue. “This is in line with GGU’s funding strategy to continue to raise new funding in local currency, with longer-term maturity,” Irakli Gilauri, BGEO’s CEO, said in a statement.

Georgian Water and Power, which supplies water to Tbilisi, Mtskheta and Rustavi, was privatised in 2008. The sale was criticised because of a perceived lack of transparency over GGU’s British Virgin Islands registration.

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Copyright ©The Conway Bulletin — all rights reserved

(News report from Issue No. 309, published on Dec. 16 2016)