Tag Archives: business

Azerbaijan downgrades plans for processing plant

JUNE 29 2016 (The Conway Bulletin) – In an effort to revive its aspirations to build a mega petrochemical plant, SOCAR, Azerbaijan’s state-owned energy company, said it would cut the capacity of its gas processing section, lowering the cost by a third to $4b.

SOCAR now plans to build a plant with a processing capacity of 10b cubic metres/year, down from 12b cubic metres/year. Downsizing the project would save around $2b, according to the company.

The original plan was much more grandiose. The OGPC petrochemical complex at Sangachal, 55km south of Baku, had at one point included an oil refinery and was quoted for a total of $16.5b. Azerbaijan wanted the project to become the region’s hub for refined products.

Last year, first Japan’s Mitsui, then the Britain-based unit of US’ Fluor Group came forward to participate in the project, but later dropped out.

SOCAR then scrapped plans for the refinery, bringing down costs to around $6b. In February, company representatives said that construction work had been frozen, due to the sustained economic malaise, triggered by low oil prices.

Now, Suleyman Gasimov, SOCAR’s VP for financing, said the company is considering two offers, one from China’s CNPC and one from a Russo-Italian consortium of Gazprombank, Russia’s export credit agency EXIAR and Italy’s credit agency SACE.

“Currently, we think the proposals from CNPC and Russian-Italian partners are the most suitable for us,” Mr Gasimov said.

If Azerbaijan manages to resurrect OGPC, even in a downsized fashion, the project will give a much-needed boost to the country’s economy.

ENDS

(News report from Issue No. 287, published on July 1 2016)

Kyrgyzstan’s Megacom bid fails

JUNE 17 2016 (The Conway Bulletin) – An auction for Kyrgyzstan’s state- owned Alfa Telecom was declared invalid after failing to receive any bids, a sign that investors find the company unattractive. In May, the government had postponed an earlier auction. Alfa Telecom, which owns the Megacom brand, was nationalised in 2014. The government said that it wants to raise $19b som ($280m) from its sale.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Iran’s ATA Airlines flies to Azerbaijan

JUNE 17 2016 (The Conway Bulletin) – Iran’s ATA Airlines flew to Azerbaijan for the first time, officially opening the new Tehran-Baku Tabriz route. The new route, which will operate twice weekly, is a sign of the growing importance of transport links between Azerbaijan and Iran. AZAL, Azerbaijan’s national carrier, also operates a direct flight to Tehran.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Kazakh oil producer restarts output

ALMATY, JUNE 21 2016 (The Conway Bulletin) — Aral Petroleum Capital, a small oil company owned by Canada’s Caspian Energy, said it had restarted oil production at the East Zhagabulak field in Kazakhstan after cutting output to zero because of the sharp fall in oil prices.

This is good news for the Kazakh oil sector, which has seen production fall from some of its least economical fields and may also indicate that other oil companies who have cut production would follow with price rises.

Aral said it welcomed the Kazakh government’s decision to cut customs duty on oil to $30/tonne from $40/tonne in February.

Michael Nobbs, chairman of Caspian Energy, said its subsidiary will now generate cash flow to boost investment as well as pay back creditors. Mr Nobbs, however, warned that creditors could hinder progress. “If a creditor were to take action to seize or block access to Aral’s bank accounts, Aral’s ability to continue producing would be seriously jeopardized,” Mr Nobbs said in a statement.

Aral operates the Zhagabulak oil field, located in the north-western Aktobe region, near Kenkiyak.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Centerra gets Kyrgyzstan licence

JUNE 23 2016 (The Conway Bulletin) – Kyrgyzstan’s State Agency for Environmental Protection and Forestry extended an environmental permit for Canadian miner Centerra Gold to operate at the Kumtor mine until the end of the year. The company now needs official approval of its mine plan for 2016 by the end of June in order to continue its work at the mine.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Editorial: Tajik electricity production

JUNE 24 2016 (The Conway Bulletin) – Tajik President Emomali Rakhmon said that he wanted to triple Tajikistan’s power generation capacity to around 45b kWh/year by 2030.

This is a long-term projection, and plenty can happen over the next 14 years, especially in Tajikistan, but it is still an important one. It is important because it shows the impact that the World Bank sponsored CASA-1000 project is having on the aspirations of Tajikistan.

Tajikistan needs to boost its exports and electricity production, through its network of hydropower stations, has emerged as the only real way of doing this. Gold production, while increasing, is still low, hopes of an oil boom spurred by the discovery of Bokhtar field have fallen flat.

But CASA-1000 has encouraged positive talk of a boom in power generation in Tajikistan. It’s important, too, to credit Tajikistan, over Kyrgyzstan, of being hard-headed about power generation. It will supply the lion’s share of the power for the CASA-1000 project, which will send electricity across Afghanistan to Pakistan, and plans to boost its power generation capacity even further show that the potential is there for more.

ENDS

(Editorial from Issue No. 286, published on June 24 2016)

Utility cost rise in Armenia

JUNE 17 2016 (The Conway Bulletin) – Armenia’s state regulator said it will consider a 5% reduction in the price it charges homes for electricity, currently in the 38.8 – 48.8dram range (8-10 cents), adding to the deflationary pressure in the economy. In April, Russia’s Gazprom agreed to apply a 9% discount to the gas it supplied to Armenia. Rising electricity costs for households had sparked a popular protest in the summer of 2015.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Kazakhstan fines ArcelorMittal

JUNE 17 2016 (The Conway Bulletin) – Steel producer ArcelorMittal Temirtau received a fine of 3.4m tenge (around $10,000) from the Kazakh government for failing to comply with its 2014 investment plan. The company, a subsidiary of Indian giant ArcelorMittal, operates the biggest steel producing plant in Central Asia. Slower demand for steel had forced the company to cut back investment and lay off workers in 2014. It had hoped that the reemergence of Iran into the international economy would boost sales.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Armenian taxi associations accuse Yandex

JUNE 23 2016 (The Conway Bulletin) – Armenian taxi associations have accused Yandex Taxi of market dumping practices as the Russian search-engine owned company tries to enter the local market. Yandex Taxi will start operations in Armenia on July 1 and has set prices that appear to be half the average rate of 500dram ($1) per 5km. The new taxi service will function through an online app. This month Uber started operations in Astana.

ENDS

(News report from Issue No. 286, published on June 24 2016)

Armenia to export electricity to Iran

JUNE 18 2016 (The Conway Bulletin) – Armenia’s state-owned power distributor Electro Power Systems Operator said it will export around 1b kWh of electricity to Iran in 2016 from itsHradzan and Yerevan thermal power plants. Armenia and Iran have signed an agreement on the exchange of Iranian gas for Armenia’s electricity.

ENDS

(News report from Issue No. 286, published on June 24 2016)