Tag Archives: hydrocarbons

Rio-Tinto is planning investments in Kazakhstan, says official

MARCH 9 2017 (The Conway Bulletin) — After a meeting with two senior officials from Rio Tinto at a trade fair in Toronto, Kazakhstan’s deputy minister for investment development, Timur Toktabayev, said that the mining company planned a couple of significant investments in the country. The British-Australian company is one of the biggest miners in the world but doesn’t currently have any projects in Kazakhstan. If it did start work on a project in Kazakhstan, it would give the country a major PR boost.

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(News report from Issue No. 320, published on March 13 2017)

Stock market: Brent

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MARCH 8 2017 (The Conway Bulletin) — Governments across the Central Asia/South Caucasus region will be nervously watching the Brent spot price as it slips back down to that all-important $50/barrel level. This is the psychological breakpoint.

If Brent oil dips below $50/barrel, national budgets, which have just been adjusted upwards, will have to be rethought. It broke through this level in mid-December and had hovered around the $55/barrel mark since then, before taking a downturn.

Oil prices had been pushed up in mid-December by a plan lead by producers to cut output. Data, though, this week showed that crude oil stocks held by the US government have risen, raising concerns that the fragile coalition patched together to contain global production was cracking. Data from Saudi Arabia, Iraq and Nigeria also suggested that production was rising again.

Kazakhstan’s output estimate has also been increased. The US Energy Information Administration (EIA) said Kazakhstan would produce 1.88m barrels of oil/day in 2017, compared to an earlier estimate of 1.86m barrels/day. In 2016, it produced 1.73m barrels of oil/day.

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(News report from Issue No. 320, published on March 13 2017)

Kazakh energy site pays fine

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MARCH 4 2017 (The Conway Bulletin) — The consortium developing the Karachaganak oil and gas site in northwest Kazakhstan paid a fine of 10.4m tenge ($32,800) because of an inventory error, media reported quoting the court in west Kazakhstan. It wasn’t specific about the inventory error. In a far bigger arbitration dispute playing out from last year, the Kazakh government has accused the Karachaganak consortium of withholding oil worth billions.

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(News report from Issue No. 320, published on March 13 2017)

Fourth Turkmen pipeline to China is ‘cancelled’

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MARCH 6 2017 (The Conway Bulletin) — In a major blow to Turkmenistan’s ambitions to cements itself as the region’s top gas exporter, Uzbekistan and China cancelled planned work on a fourth pipeline that was to pump gas to Chinese consumers.

The so-called Line D was quietly dropped at the beginning of the month, media reported quoting a RIA-Novosti article. In the article, RIA-Novosti quoted unnamed officials as saying a drop in demand for gas in China meant that there was no need to build an expensive fourth pipeline from Turkmenistan.

A JV between China’s CNPC and Uzbekneftegas had been created in 2014 to build the 200km section of the pipeline through Uzbekistan. Work had been due to start in H1 2016 but had been pushed back.

For Turkmenistan, the cancelling of Line D, which hasn’t been officially confirmed by Ashgabat or Beijing, is bad news. It’s economy is reliant on gas exports, and with prices low, it is floundering.

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(News report from Issue No. 320, published on March 13 2017)

Azerbaijan’s SOCAR buys oil tankers

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MARCH 10 2017 (The Conway Bulletin) — Socar, Azerbaijan’s state oil and gas company, bought seven large oil tankers from Turkey-based Palmali last month to boost trade capacity in the Caspian Sea and the Mediterranean. In an interview with Reuters, Arzu Azimov, head of the Geneva-based Socar Trading, said the company wanted to boost its shipping capacity. Socar Trading now owns 37 tankers, although most of these are significantly smaller than the large tankers it has just bought.

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(News report from Issue No. 320, published on March 13 2017)

Oil price gives Kazakh GDP boost

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MARCH 2 2017 (The Conway Bulletin) — Strong oil prices may boost GDP growth in Kazakhstan to 2.8% this year, economy minister Timur Suleimenov told Reuters in an interview. The previous government GDP growth estimate for 2017 had been 2.5%. Last month, Kazakhstan increased its expected oil price this year for its government budget to $50/barrel up from $35/barrel.

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(News report from Issue No. 319, published on March 3 2017)

Azerbaijan’s Socar fails to buy Turkish petrol stations

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MARCH 3 2017 (The Conway Bulletin) — Azerbaijan’s state-owned oil and gas company Socar failed in its high-pro- file bid to buy up the chain of petrol stations in Turkey owned by Austria’s OMV.

Instead, OMV said it had sold the group of 1,785 petrol stations, called Petrol Ofisi, to Vitol Investment Partnership, a subsidiary of commodities company Vitol for $1.45b. Petrol Ofisi is the biggest petrol retailer in Turkey with a 23% market share.

The failure to secure a petrol station group will be a disappointment to Socar, Last month, in an interview with a Turkish newspaper, the general director of Socar Turkey Energy, Zaur Gahramanov, said that if its bid to buy the OMV petrol stations in Turkey failed, it would pursue alternative options.

Socar owns the Star oil refinery in Turkey and has said that it wants to expand its downstream operations.

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(News report from Issue No. 319, published on March 3 2017)

BP cuts costs in Azerbaijan

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FEB. 21 2017 (The Conway Bulletin) — BP cut its costs in Azerbaijan by 17.8% in 2016, Azerbaijani media reported by quoting the British company. The cut in expenditure is probably a reflection of the drop in the price of oil and the need for energy companies to cut costs. Azerbaijan has been hard hit by the drop in oil prices, forcing it to reduce its budget and various social development programmes. BP is the biggest foreign investor in Azerbaijan and has helped to build up its energy sector since the 1991 collapse of the Soviet Union.

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(News report from Issue No. 318, published on Feb.24 2017)

Italy moves olive trees for Azerbaijani gas pipeline

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FEB. 23 2017 (The Conway Bulletin) — The authorities in Italy have started moving 200 olive trees that stood in the way of the TAPI pipeline which is slated to pump gas from the Caspian Sea to Europe. Environmentalists had wanted the pipeline re-routed to save the trees but the pipeline’s backers said that this would delay Azerbaijani gas reaching Europe and also add millions of dollars to the cost. The authorities, in the end, decided it was simplest just to move the trees.

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(News report from Issue No. 318, published on Feb.24 2017)

Azerbaijan-Russia-Iran to hold talks on energy corridor

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FEB. 21 2017 (The Conway Bulletin) — Russia, Azerbaijan and Iran plan to meet up next month to discuss setting up a North-South energy corridor, Russian energy minister Alexander Novak was quoted by media as saying. This is important as regional governments have been talking about trying to build a North-South energy corridor for years. It would give gas and oil produced in Russia, Central Asia and the South Caucasus access to the Persian Gulf, and Iran much- needed energy supplies in the north of the country.

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(News report from Issue No. 318, published on Feb.24 2017)