Tag Archives: business

Kazakhstan-based financial institutions sign agreement

NOV. 21 2016 (The Conway Bulletin) — Kazakhstan-based financial institution Almex Holding and Dutch company Staay Food Group signed an agreement to create a joint venture to develop agribusiness in Kazakhstan. They want to create a distribution network with local farmers. At a later stage, Staay Food said it plans to build greenhouses to boost exports of fresh fruits and vegetables. Almex group controls Halyk Bank, Kazakhstan’s second- largest bank, and is owned by President Nursultan Nazarbayev’s daughter Dinara and her husband, Timur Kulibayev.

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(News report from Issue No. 306, published on Nov. 25 2016)

S&P improves credit outlook for Georgian Co.

NOV. 21 2016 (The Conway Bulletin) — Ratings agency Standard & Poor’s improved the credit outlook for Georgian Oil and Gas Corporation from negative to stable, saying its performance had improved. Standard & Poor’s affirmed the company’s credit rating at B+/B and positively reviewed the financial health of the company, which is poised to decrease reliance on loans.

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(News report from Issue No. 306, published on Nov. 25 2016)

Total signs deal to produce gas at Azerbaijan’s Abershon

NOV. 21 2016 (The Conway Bulletin) — French energy company Total signed an agreement to develop the first phase of the Absheron gas and condensate field in Azerbaijan, a major boost for the country’s oil and gas sector, although it also said that production levels would be far lower than originally projected.

Total discovered Absheron in 2011 and owns a 40% stake in the project. Other shareholders include state- owned SOCAR (40%) and ENGIE, a French utility company (20%).

The company had said the field, off the Absheron peninsula, around 60km from Baku, would produce 5b cubic metres (bcm) of gas annually in the first stages and between 7 and 8 bcm at a later stage. But Total’s latest press release told a different story.

“The development involves the drilling of one well at a water depth of 450 meters. Production from this high pressure field will be around 35 thousand barrels of oil equivalent per day, including a significant portion of condensate,” Total said.

This means that yearly production volume would be around 2.1 bcm, 60% smaller than originally planned.

Analysts said that the Azerbaijani government has pressured Total into producing at Abershon ahead of the original target start date, possibly forcing it to cut output targets.

“If they previously planned to produce first gas in 2022, now they talk about the beginning of 2020,” Ilham Shaban, head of the Caspian Barrel research outfit, told the Vestnik Kavkaza website.

Absheron’s gas will compensate for declining domestic production in Azerbaijan, according to Total.

“The produced gas will supply Azerbaijan’s domestic market,” the company said.

Azerbaijan’s gas production has flatlined in recent years to around 19bcm and it is poised to decline this year.

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(News report from Issue No. 306, published on Nov. 25 2016)

Kazakhstan-based Central Asia Metals expands

NOV. 22 2016 (The Conway Bulletin) — London-listed copper producer Central Asia Metals said it bought an 80% interest in a copper exploration property in northern Kazakhstan. The company said that it paid local company GRK-Aksu around $1m for the stake and has pledged to invest another $1m in the deposit in 2017.

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(News report from Issue No. 306, published on Nov. 25 2016)

Kazakh mayor to bring London cabs

NOV. 23 2016 (The Conway Bulletin) — Gabidulla Abdrakhimov, mayor of Shymkent in southern Kazakhstan, flew to London to meet British business representatives and to float the idea of bringing the iconic London cabs to his city. Gipsy cabs are commonplace in Kazakhstan, although taxi companies and ride-hailing apps have gained an increasing share of the market in recent years. In 2012, Magnesium Bronze’s London cabs became the only official taxi brand in Baku, Azerbaijan.

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(News report from Issue No. 306, published on Nov. 25 2016)

Russia approves military deals with Uzbekistan

NOV. 18 2016 (The Conway Bulletin) — Russian PM Dmitri Medvedev approved an agreement to develop military technology ties between Russia and Uzbekistan, an early indication that ties between the two countries are already improving less than two months after the death of former president Islam Karimov. Acting president Shavkat Mirziyoyev has made improving Uzbekistan’s international relations a priority. Russian president Vladimir Putin was one of the first foreign leaders to visit Uzbekistan after the death of Karimov in September.

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(News report from Issue No. 306, published on Nov. 25 2016)

Azerbaijan-based Zenith receives payments

NOV. 21 2016 (The Conway Bulletin) — An Azerbaijan-based subsidiary of Canada’s Zenith Energy said it received the first payments for its oil sales at three onshore fields it is developing with state-owned SOCAR. Zenith Aran Oil and SOCAR had signed a production sharing agreement in March. Zenith has an 80% share in the Muradkhanli, Jafarli and Zardab fields for the next 25 years. SOCAR will retain the remaining 20%. Oil from these fields is sold internationally at the Russian Black Sea port of Novorossiysk. On the same day, British investment company Gunsynd invested £100,000 ($125,000) in Zenith Energy, as part of a £500,000 fundraising effort.

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(News report from Issue No. 306, published on Nov. 25 2016)

Japan’s Mitsubishi signs second power plant deal in Uzbekistan

NOV. 21 2016 (The Conway Bulletin) — Japan’s Mitsubishi Corporation won a contract to build a 900MW combined-cycle power plant in the Ferghana Valley in eastern Uzbekistan, a critical development for the country’s power generation sector.

This is Mitsubishi’s second deal in Uzbekistan in the past month. In October, it agreed to build a second co-generation station at the Navoi thermal power plant. In July 2015, Mitsubishi had won a tender to build a fertiliser plant in Navoi.

Mitsubishi said that the Japanese and Uzbek government will finance construction of the Turakurgan Thermal Power Station.

“This project will be financed by an Official Development Assistance (ODA) Loan provided by the Japan International Cooperation Agency (JICA), and Uzbek government funds,” the company said in a statement.

The parties did not disclose the value of the contract, this secrecy is not unusual in Uzbekistan, but an earlier assessment of the project said it would cost $704m.

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(News report from Issue No. 306, published on Nov. 25 2016)

France’s Veolia beats rivals to win $800 contract for Armenia’s water

NOV. 21 2016 (The Conway Bulletin) — French utility company Veolia will become the near-monopoly water distribution and sewage management operator in Armenia, after beating European rivals to the €800m ($845m) contract.

Veolia, one of the biggest water and waste management companies in the world with around 175,000 employees and revenues of over $30b/year, already controls Yerevan Djur, a local utility company that supplies water and sewage services to the capital. Through this entity, Veolia already employs 1,200 workers in Armenia and, under the new 15 year contract, it will become one of the country’s largest employers.

Veolia’s management hailed the tender victory as a major achievement.

It beat French rival Saur, Italy’s Acea and a German-Russian consortium for the contract.

“This success is exemplary: it is the result of a joint effort by Veolia’s teams who have managed to capitalise on the experience and professionalism of the Group’s employees in Yerevan and to apply the best practices developed by a network of experts working in over 40 countries,” Malika Ghendouri, Veolia’s vice president of Central and Eastern Europe, said in a statement.

Armenia doesn’t have natural resources on the scale of its neighbours Azerbaijan or even Georgia, making water management one of the most lucrative sectors for Western companies.

Saur had managed four other major water utility companies in Armenia but will now relinquish control to Veolia at the start of 2017.

Several international financial institutions, among which the EBRD and the European Investment Bank, pledged to support Veolia’s infrastructure work in Armenia, which the company forecast at $200m in the next four years.

One of the reasons that Veolia won the contract was its apparent drive to improve water services across the region. Armenia’s Soviet-era infrastructure needs updating.

Allegations of corruption have marred the privatisation of Armenia’s water utilities since the early 2000s. The World Bank, which masterminded the privatisation, dismissed the allegations in 2007 and 2008.

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(News report from Issue No. 306, published on Nov. 25 2016)

Armenia to cut energy consumption

NOV. 23 2016 (The Conway Bulletin) — Armenia plans to cut its consumption of gas, electricity and coal by 38% and boost its electricity generation from renewable sources, deputy energy minister Hayk Harutyunyan told local media. The ambitious plan appears to be another attempt by cash-strapped countries in Central Asia and the South Caucasus to cut expensive energy consumption. Azerbaijan and Kazakhstan have both announced plans to cut back on electricity-generation plans. Kyrgyzstan has also hinted it wants to use more green energy.

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(News report from Issue No. 306, published on Nov. 25 2016)