Tag Archives: gas

Turkmenistan fails to pay salaries

JUNE 13 2016 (The Conway Bulletin) – Employees of Turkmenistan’s state-owned oil and gas companies said they have not received salaries for months, the opposition Alternative News Turkmenistan website reported. Previous reports had said that state employees had not received salaries and had been forced to accept state bonds instead.

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(News report from Issue No. 285, published on June 17 2016)

Turkmenistan’s dream pipeline to be ready by 2020

JUNE 11 2016 (The Conway Bulletin) – TAPI, the proposed gas pipeline that will pump gas from Turkmenistan through Afghanistan and Pakistan to India, will be ready in 2020, Pakistan’s minister of natural resources Shahid Khaqan Abbasi told media. This is yet another official voice pushing back the completion date of the project, originally planned for 2019.

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(News report from Issue No. 285, published on June 17 2016)

Kazakh Minister says Karachaganak talks are friendly

ALMATY, JUNE 6 2016 (The Conway Bulletin) — Kazakhstan’s energy minister Kanat Bozumbayev denied that the government was using multi-billion dollar fines against the consortium operating the Karachaganak gas and condensate field to negotiate more favourable terms to a Production Sharing Agreement (PSA) drawn up in 1997.

Mr Bozumbayev’s comment contradicts statements by shareholders in Karachaganak. Russian oil company Lukoil said in its Q1 report that Kazakhstan’s total claims for the renegotiation of the Karachaganak contract have grown to $1.8b, up from $1.6b it had highlighted in April.

At a press conference in Astana, Mr Bozumbayev tried to shrug off the allegations.

“The reason I do not comment on these issues is that my words are then taken out of context and I read that Kazakhstan wants to sue,” media quoted him as saying. “Kazakhstan is holding friendly negotiations with the shareholders of the Karachaganak project.”

Mr Bozumbayev’s comments are the most clear to date that the Kazakh government is holding direct talks with the Karachaganak partners on a new PSA deal.

Essentially, the Kazakh government wants a greater share of the profits from Karachaganak. Last week, the FT reported that the Kazakh government had rejected a $300m deal to settle the dispute.

The consortium is Eni (29.25%), BG (29.25%), Chevron (18%), Lukoil (13.5%) and Kazmunaigas (10%).

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(News report from Issue No. 284, published on June 10 2016)

Azerbaijan’s energy company to boost production

JUNE 6 2016 (The Conway Bulletin) — Azerbaijan’s state-owned energy company SOCAR said it aims to increase oil and gas production at several offshore fields in the Caspian Sea. The company said it will build nine new platforms to drill 81 wells. CEO Rovnag Abdullayev said a new gas platform in the Guneshli block will be the first to be entirely designed and built by SOCAR.

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(News report from Issue No. 284, published on June 10 2016)f

Azerbaijan’s energy company to build Malta gas power station

JUNE 5 2016 (The Conway Bulletin) — Azerbaijan’s state-owned energy company SOCAR said it will start building a gas-fired power station, fed by liquefied natural gas (LNG), in Malta by the end of year, ending years of delays for the project.

ElectroGas will build the 215MW LNG-to-power plant at the Delimara port, on the eastern Maltese coast, and will be its exclusive gas supplier. Switzerland-based SOCAR Trading, Germany’s Siemens and US-based General Electric own ElectroGas.

Media quoted SOCAR representatives as saying that “the facility will be commissioned before the end of the year.” They did not say how much it would cost to build, although Maltese media have speculated between $500m and $1b.

In effect the site is a large LNG terminal with a power plant attached. Malaysia’s Bumi Armada, an offshore services company, is building the $300m LNG storage facility at Delimara in Q3 2016. The floating terminal will have a capacity of around 95 tonnes of LNG.

Maltese media has repeatedly attacked the government for the delays in the commissioning of the power plant. Malta needs to boost its power generation capacity.

Earlier in 2015, Malta’s Auditor General launched an investigation into potential abuse of power by energy minister Konrad Mizzi, who had allegedly interfered in the purchase of fuel from SOCAR.

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(News report from Issue No. 284, published on June 10 2016)

Russia and Turkmenistan discuss gas deal

MAY 31 2016 (The Conway Bulletin) — Russia’s gas giant Gazprom said it may resume gas imports from Turkmenistan, less than a year after bad- tempered rows over prices led to the Kremlin scrapping shipments of gas.

Alexander Medvedev, deputy chairman at Gazprom, said the parties were still in talks and it was too early to say whether a settlement can be reached.

“There is a window of opportunity. We are ready to negotiate, but, unfortunately, there is no clear road- map,” Mr Medvedev told the press.

Even just the decision to negotiate signals a U-turn by Russia and Turkmenistan over both their gas policies and relations in general.

At one point during the various arguments in 2015, Gazprom took the Turkmen government to court to try to force it to reduce gas prices.

China has become Turkmenistan’s favoured destination for its gas exports since a pipeline connection was completed in 2009.

But now, facing delays in the section of the pipeline that crosses Kyrgyzstan, China has pushed back its investment plans for the giant Galkynysh gas field in Turkmenistan.

This is likely to frustrate Turkmenistan, which bet heavily on China as an alternative to Russia, and could provide an opportunity to resume gas trade with Gazprom.

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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)

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)

Litigation case will not affect sale, says Kazakh energy company

MAY 30 2016 (The Conway Bulletin) — Kazmunaigas, Kazakhstan’s state- owned energy company, said that a litigation case in Romania involving one of its subsidiaries will not affect the sale of the unit to China’s CEFC. Last December, CEFC agreed to buy a 51% stake in KMG International, formerly Rompetrol. Romanian prosecutors seized KMG International’s refinery earlier in May during an investigation into its privatisation and subsequent sale to to Kazmunaigas.

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

Turkmenistan discusses TAPI financing

MAY 21 2016 (The Conway Bulletin) — The Turkmen government said it has started negotiations with the Islamic Development Bank and other international financial institutions to open credit lines for funding the TAPI gas pipeline, which will pump gas to Pakistan and India through Afghanistan. Among potential backers, Turkmenistan has targeted Saudi Arabia and Japan. The pipeline, which will cost $10b and have a capacity of 33b cubic metres per year, is scheduled for completion in 2019.

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(News report from Issue No. 282, published on May 27 2016)