Tag Archives: business

Kazakh energy company drills wells

OCT. 19 2016 (The Conway Bulletin) – Roxi Petroleum, a Kazakhstan-based oil and gas company, said it had successfully drilled new wells at its BNG Contract Area, a group of oil fields in western Kazakhstan. Roxi said the drilling of the A6 deep well had been challenging, but that the expansion of the field was continuing as planned. On the day of the announcement, its stock price increased by 18% to 10.5p in London.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Turkmenistan signs $700m loan deal for TAPI with IDB

OCT. 14 2016 (The Conway Bulletin) – Turkmenistan and the Islamic Development Bank (IDB) signed a $700m loan deal for the construction of the so-called TAPI gas pipeline that will pump Turkmen gas to India via Afghanistan and Pakistan.

This is an important deal, not just because of its size, but also because it brings a second major international institution into the project. Turkmenistan has been powering the project, kicking off construction in December, but, up until now, Western companies and financial institutions, other than the Manila- based Asian Development Bank, have steered away from joining it.

Now, though, after months of negotiations, the normally publicity shy Turkmen Bank for Foreign Economic Activities met up with the IDB in Washington DC to agree the loan.

Through its official news website, Turkmenistan lauded the deal.

“The construction of the transnational gas pipeline will ensure the long-term supply of energy in the countries of Southeast Asia and will ensure further economic development in the region,” it said.

For months, Turkmenistan has negotiated with IDB and other international financial institutions for loans and grants. The Asian Development Bank, adviser to the project, agreed a $200m loan in April, when it also said the project was ‘doable’.

Others have been less impressed, calling the project, literally, a pipe- dream that couldn’t be done.

And it is certainly a challenge. The plan is to build a 1,800km pipeline from Turkmenistan across Afghanistan to Pakistan and India. The cost of the pipeline is estimated at $10b.

The IDB, which is headquartered in Jeddah, has not commented on the $700m loan for TAPI.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh oil pipeline operator to allocate its route

OCT. 18 2016 (The Conway Bulletin) – KazTransOil, Kazakhstan’s state owned oil pipeline operator, said that the first shipments of oil from Kashagan will be allocated to the Atyrau-Samara pipeline and sold at the Russian port of Ust-Luga, near St. Petersburg. Production at Kashagan re-started last week after years of delay. In October, the consortium plans to pump at 90,000 barrels/day. The Kazakh government is banking on Kashagan to propel it into the Premier League of oil producers.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Flights restart between Turkmenistan and Georgia

OCT. 17 2016 (The Conway Bulletin) – Georgia and Turkmenistan will launch new direct flights in November, linking Tbilisi and Ashgabat. The flights will run twice weekly and will be operated by Turkmenistan Airlines. Since Georgian President Giorgi Margvelashvili’s visit to Turkmenistan in 2014, relations between the two countries have improved. Now, the governments want to boost trade beyond oil products which dominate.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Georgia joins EU’s Energy Community

TBILISI, OCT. 14 2016 (The Conway Bulletin) — Georgian energy minister Ilia Eloshvili signed a deal for Georgia to join Europe’s Energy Community, meaning that it will now impose various EU rules and regulations over its electricity and gas networks.

For Georgia, joining the Energy Community is another step towards integrating its economy, and in this case energy network, more closely with the EU.

Earlier this year it entered into an Association Agreement with the EU which will make it easier to sell goods in Europe and this month EU members states said that Georgia should receive visa-free access to the Schengen zone.

At the signing ceremony in Sarajevo, the capital of Bosnia Herzegovina, Mr Eloshvili was clear about Georgia’s overall intentions.

“By receiving the status of the contracting party, we plan to embark on the implementation of new round of reforms for approximating Georgia’s energy sector with the European Union energy market rules,” media quoted him as saying.

Georgia had said in February that it wanted to join the Energy Community. Along with EU member states, Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Moldova, Montenegro, Serbia and Ukraine are members of the Energy Community.

Georgia is expected to become a member next year after its parliament ratifies the deal and Dominique Ristori, director general for Energy at the European Commission said it would give the project momentum.

“With yet another new country joining the Energy Community family, this framework for the creation of a pan-European energy system is once again showing that it is relevant and successful,” he said.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Cotton exports rise in Uzbekistan

OCT. 15 2016 (The Conway Bulletin) — At its annual cotton fair, Uzbekistan reportedly signed deals to export finished cotton worth $1.3m, up from $800m in 2015, Radio Free Europe/Radio Liberty reported. Cotton is one of Uzbekistan’s most important exports. Many Western brands refuse to use Uzbek cotton in their garments because of its association with child labour.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Gerogia TBC Bank completes buyout of rival

TBILISI, OCT. 18 2016 (The Conway Bulletin) — Georgia’s TBC Bank completed the takeover of Bank Republic, making it the biggest bank in the country in terms of loans.

At the same time, the Georgian Central Bank suspended the licence of Progress Bank, linked to former energy minister Kakha Kaladze and billionaire Bidzina Ivanishvili, suggesting that a deal for TBC Bank to buy it was about to go through.

TBC had bought most of Bank Republic last month from Societe Generale for 315m lari ($136m) but still had to buy the final 6.4% from the European Bank for Reconstruction and Development.

Vakhtang Butskhrikidze, TBC Bank CEO, enthused about the future. “We believe the acquisition of Bank Republic is a critical step in delivering on TBC Bank’s strategy and represents a major step forward

in TBC Bank’s ambition to build the leading banking group in Georgia and the broader Caucasus region,” he was quoted by media as saying.

Importantly, the deals shift TBC Bank from having a 5.3% share of the deposits market to a 34.5% share.

Georgia’s banking sector is generally considered the most advanced in the South Caucasus. Bank of Georgia, TBC’s rival, is listed on the London Stock Exchange.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Kazakhs turn to credit cards

ALMATY, OCT. 18 2016 (The Conway Bulletin) — Kazakhs are spending more money on credit cards than ever before, new data showed, as they try to work out ways of pulling through a prolonged economic downturn.

Data from the rankings.kz website showed that the amount of credit cards in circulation in Kazakhstan had increased by 250% this year, a jump that suggests a large rise, too, in consumer debt.

Kuralai Abenova, a student in Almaty, was using her credit card to buy kit to renovate her apartment.

“It is very convenient rather than saving money. I can take a large sum of money and then pay little bits of it off regularly,” she said.

A crash in oil prices and a recession in Russia have hit Kazakhstan hard. The tenge currency has lost around 50% of its value since 2014 and inflation is rising.

Analysts have previously warned, though, that Kazakhs’ over-reliance on credit was a weakness that could undermine the economy. During the Global Economic Crisis of 2008/9, Kazakh banks were left with piles of bad debt. The risk is that similar amounts of bad debt are being accrued now.

And this loose attitude towards consumer debt is being replicated in high street shops which are encouraging shoppers to spend through cheap loans.

Saida Zhunusova, a financial consultant at the electronics store Technodom, said she had seen a large increase in the number of people using credit cards or asking directly for credit to pay for products.

“Many people cannot pay for the goods with cash and it is more convenient for them to pay only a part of the cost. Compared to 2014-2015 our sales have doubled because of loans,” she said.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh court fines Ural Oil and Gas

OCT. 20 2016 (The Conway Bulletin) – A court in Kazakhstan slapped a 2.1b tenge ($6.23m) fine on Ural Oil and Gas, a small energy company, for environmental damage. According to the prosecutor, the company had illegally disposed of its drilling waste at its operations in the Fedorovsky Bloc in Western Kazakhstan. State-owned Kazmunaigas (50%) and Hungary’s MOL (27.5%) are the two largest shareholders in Ural.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)

Kazakh electricity grid operator to pay dividend

OCT. 19 2016 (The Conway Bulletin) – KEGOC, Kazakhstan’s state-owned electricity grid operator, said it would pay a dividend of 24.93 tenge/share (7.5 cent) to its shareholders. The dividend, which measured 40% of the company’s first half net profit, was, proportionally, significantly lower than its dividend last year, when it redistributed all net profit among its shareholders.

ENDS

(News report from Issue No. 301, published on Oct. 21 2016)