Tag Archives: business

Kazakhstan to take majority control of major uranium mine

ALMATY, MAY 31 2016 (The Conway Bulletin) — Canada’s Cameco, the world’s largest publicly traded uranium company, said it will cut its stake in its joint venture with Kazakhstan’s state-owned Kazatomprom, giving the Kazakh government majority control over one of its biggest uranium deposits.

Under the new agreement Cameco and Kazatomprom will extend their partnership in the Inkai joint venture until 2045, although the share split will switch from 60:40 in Cameco’s favour to 60:40 in Kazatomprom’s favour.

Inkai is one of the most important uranium deposits in Kazakhstan.

Cameco’s CEO Tim Gitzel said in a statement: “The agreement advances our strategy to mitigate the risk of today’s uncertain uranium market and positions us to maximize returns when the market recovers.”

Under the plan, also welcomed by Kazatomprom chairman Askar Zhumagaliyev, Inkai will double uranium production to 4,000 tonnes and could potentially build a new uranium refinery.

In its annual report, Cameco said it was surprised by continued low uranium prices.

The deal also comes a few months after Kazakh President Nursultan Nazarbayev hinted he wanted more state control over the uranium sector.

“It is necessary to either ensure that [Kazatomprom’s partners] meet their obligations or look into reclaiming those assets in the interests of our state,” Mr Nazarbayev said.

This is in line with policy in other sectors, such as oil and gas where Mr Nazarbayev also wants to extend control.

Kazakhstan, which is the world’s largest uranium producer, is faced with a dilemma. It needs the expertise of large uranium companies such as Cameco, France’s Areva and Japan’s Sumitomo to become a safe and reli- able hub for nuclear fuel, but it also wants to gain more control of an industry it had widely privatised in the first years after independence.

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(News report from Issue No. 283, published on June 3 2016)

Azerbaijan’s energy company reorganises its assets in Turkey

JUNE 1 2016 (The Conway Bulletin) — SOCAR Turkey Enerji, a subsidiary of Azerbaijan’s state-owned energy company, has said it wants to buy stakes in a pipeline and a lubricants company and sell a stake in a refinery, in a major shake up of its operations in Turkey.

SOCAR Turkey Enerji said it is interested in buying OMV Petrol Ofisi, a subsidiary of the Austrian energy company that produces fuel and lubricants in Turkey. To secure the deal, the Azerbaijani company will have to beat competition from Chinese and Japanese companies.

“SOCAR has an interest in this deal. We are waiting for the company to submit information on these assets,” Zaur Gakhramanov, the company’s head, told local media. He also said his company wants to buy a 7% stake in TANAP, the Trans-Anatolian gas pipeline, from SOCAR, which owns a 58% stake in the project.

Perhaps adding to the company’s expansion plans, Mr Gakhramanov also said that SOCAR Turkey Enerji plans an IPO in 2020 for 49% of its shares. He did not say where the company’s shares would list.

But this year SOCAR Turkey Enerji has also looked to sell.

In May, it said it wanted to sell off its shares in Turkey’s petrochemical complex Petkim. In March SOCAR Turkey Enerji cut its share in Petkim from 8.07% to 5.32%. SOCAR Turkey Petrokimiya, another SOCAR subsidiary, still owns 51% of the project.

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(News report from Issue No. 283, published on June 3 2016)

Kazakhstan wants better Karachaganak deal

ALMATY, JUNE 2 2016 (The Conway Bulletin) — The Kazakh government has rejected a $300m settlement for a $1.6b fine it levied at the consortium of companies developing Karachaganak, the FT reported quoting Kanat Bozumbayev, Kazakhstan’s energy minister, fuelling speculation it may want to leverage a bigger stake in the project.

Mr Bozumbayev said the government had dismissed a settlement offer from the consortium.

“It has already returned the investment shareholders made, and now it will give Kazakhstan profits, so we are negotiating,” Mr Bozumbayev said.

This week, Bloomberg quoted unnamed sources as saying that Kazakhstan is seeking to increase its share in the consortium, led by Eni (29.25% stake), Shell (29.25% through BG), Chevron (18%), Lukoil (13.5%) and state-owned Kazmunaigas (10%).

Kazmunaigas gained its 10% stake in Karachaganak in 2011 after settling a lawsuit against the consortium for tax evasion and environmental damage.

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(News report from Issue No. 283, published on June 3 2016)

Kazakh airline opens new links to Georgia

MAY 30 2016 (The Conway Bulletin) — SkyBus, a small airline in Kazakhstan, opened additional charter flights for the summer months from eight different Kazakh cities to the Georgian resort town of Batumi, on the Black Sea coast. Batumi is Georgia’s tourist hotspot and the new air link shows how popular it is becoming with ordinary Kazakhs.

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(News report from Issue No. 283, published on June 3 2016)

Refinery capacity rises in Turkmenistan

MAY 31 2016 (The Conway Bulletin) — Turkmenistan’s ministry of oil and gas said it wants to double oil refining capacity in the country over the next three years, in an effort to increase the domestic output of oil products. The ministry said it plans to increase capacity to 20m tonnes by 2020 and then to 30m tonnes by 2030. Last year, Turkmenistan missed its goal of reaching its refining capacity of 15m tonnes. It currently only process around 11m tonnes/year.

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(News report from Issue No. 283, published on June 3 2016)

Kazakh businessman to sell MEGA

JUNE 1 2016 (The Conway Bulletin) — Nurlan Smagulov, one of Kazakhstan’s wealthiest businessmen, said he has found a buyer for his shopping malls in Astana and Aktobe, both under the MEGA brand. Last year, Mr Smagulov sold his MEGA shopping mall in Shymkent, in the south of the country. Mr Smagulov said proceeds from the sales will fund the growing costs for the completion of the MEGA Silk Way shopping centre in Astana.

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(News report from Issue No. 283, published on June 3 2016)

Russia to ship oil to China, via Kazakhstan

MAY 30 2016 (The Conway Bulletin) — Nurtas Shmanov, head of Kazakhstan’s pipeline operator KazTransOil, said the company is ready to increase shipments of Russian oil to China via a Kazakh pipeline from 7m to 10m tonnes/year. Mr Shmanov said the pipeline wouldn’t need to be expanded to carry out the operation, effectively hinting that Kazakhstan could downsize its own oil exports to China.

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(News report from Issue No. 283, published on June 3 2016)

Georgia to build new airport

MAY 31 2016 (The Conway Bulletin) — State-owned company United Airports of Georgia said it had opened a tender for the construction of a new airport in the town of Zugdidi, 300km west of Tbilisi. The new airport, which will be built in the same location as the existing one, will service both domestic and international flights.

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(News report from Issue No. 283, published on June 3 2016)

Azerbaijan readying a 2nd Eurobond

JUNE 1 2016 (The Conway Bulletin) — Azerbaijan’s state-owned Southern Gas Corridor company said it will issue a second $1b Eurobond by the end of 2016 or early next year, Bloomberg reported. The Southern Gas Corridor, which is in charge of a pipeline network that will connect Azerbaijan’s gas fields with European consumers by 2019, issued a $1b Eurobond in March. Sustained low oil prices have hit the financial feasibility of several large infrastructure projects across the region.

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(News report from Issue No. 283, published on June 3 2016)

Kazakhstan’s oil pipeline company grows by 2%

MAY 30 2016 (The Conway Bulletin) — Revenues for KazTransOil, Kazakhstan’s state-owned oil pipeline company, grew by 2% to 54.7b tenge ($164m) in Q1 2016, compared to the same period last year. As capital expenditures almost halved to 6.6b tenge ($20m), analysts remain confident that the company will benefit from the depreciation of the tenge in Q4 2015 and also from rising oil prices.

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(News report from Issue No. 283, published on June 3 2016)