Tag Archives: oil

Editorial: Iran’s return

JAN. 22 2016 (The Conway Bulletin) – There is much excitement in our region over the emergence of Iran after over a decade of US-imposed sanctions.

New flight connections, new pipelines, new transmission lines and more is what a sanctions-free Iran could bring to the South Caucasus and Central Asia.

Iran has struck a deal with Air Astana to open the Almaty-Tehran air route. It has also revived talks with Turkmenistan about gas fields and pipelines around the Caspian.

Potentially, a new network to the east of the Caspian Sea could facilitate the European Union’s plans to import gas from the region. Azerbaijan may well be interested in such deals as well. In addition, Iran could become an important supplier of gas to both Armenia and Georgia.

On the flip side, Iran’s accession to the global oil market will undoubtedly drive the price of oil further down, it has huge oil reserves and production capacity, increasing the pressure on the budgets of oil-exporting economies in the region.

ENDS

Editorial from Issue No. 264, published on Jan. 22 2016)

Stock market: Tethys, KAZ Minerals, Centerra

JAN. 21 2016 (The Conway Bulletin) — Tethys shares dropped to their lowest price since listing in 2011, falling 18% over the last week to 1.75p. Our graph shows its fall since the start of December.

Problems at its operations in Tajikistan may have dented investors’ confidence. China’s CNPC and France’s Total, its partners in the Bokhtar oil project, have said they want Tethys to exit the venture.

Last week, also, the Tajik government joined the fray and said it might expropriate 25% of the licensed area, as production hasn’t started yet.

Commodities prices were stable, after months of depreciation against the US dollar. But this has not helped all miners in the region. In fact, Centerra shares fell, due to the ongoing controversy with its Mongolian operations. On the upside, KAZ Minerals continued its upward trend, thanks to the continued depreciation of the Kazakh tenge. Its costs are in tenge. Its earnings in US dollars.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Armenia asks for gas price help

JAN. 21 2016 (The Conway Bulletin) – Armenia asked Gazprom to lower the prices of gas imports by 21% to $130 per thousand cubic metres to help it weather a fierce economic storm that has hit the region.

Media reported that Armenian gas consumers currently pay an excessive price for gas. Russia reduced the cost of gas sold to Armenia last year but the government didn’t pass that saving on to consumers. It now says that it’s time to give Armenian consumers a discount.

Last year, Armenians protested at a proposed increase in the price of electricity, giving the authorities a sharp reminder of their reputation for street-level politics.

In that instance the government backed down and avoided the price rises.

Armenia is a key Russian ally in the South Caucasus. The Russian military maintains a major base in Armenia.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Low oil prices hurt Georgia

JAN. 21 2016 (The Conway Bulletin) – Although not an energy producing country, Georgia is also suffering heavily from the continued low oil prices, PM Giorgi Kvirikashvili said during a speech at the Davos Economic Forum. He said that as an oil trading nation, investment linked to energy has dried up over the past year. Mr Kvirikashvili again said that the government was looking into a 0% tax scheme on reinvested profits.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Ozenmunaigas denies media reports

JAN. 19 2016 (The Conway Bulletin) — Ozenmunaigas, a subsidiary of Kazakhstan’s state-owned energy company Kazmunaigas, denied reports in the media that it has received preferential treatment over taxes owed to the government. In a separate statement, Kazmunaigas said that Ozenmunaigas’s break-even oil price for the first three quarters of 2015 was $65/barrel, above the average global price of $55/barrel.

ENDS

(News report from Issue No. 264, published on Jan. 22 2016)

Turkmenistan retrieves another oilman body

JAN. 11 2016 (The Conway Bulletin) – The Turkmen authorities retrieved the body of another missing Azerbaijani oil worker in the Caspian Sea. A storm hit an oil field in the Azerbaijani sector of the Caspian Sea shortly before Christmas, triggering a fire that killed 33 people. It was the worst offshore oil rig accident since Piper Alpha, in the North Sea, in 1988. Some of the bodies have been found in the Turkmen sector of the Caspian Sea.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Tajikistan says it’s unhappy with progress on oil and gas field

DUSHANBE, JAN. 12 2016, (The Conway Bulletin) — The Tajik government said it was dissatisfied with the progress of the Bokhtar Operating Company, a joint venture between Tethys Petroleum, Total and CNPC which is exploring the country’s most promising oil field.

Murod Jumazoda, head of the government’s Geology Department, said the consortium was developing the site too slowly and that this could result in the government seizing 25% of the licensed area.

“They [the companies forming the joint venture] will have to return 25% of the oil and gas exploration area to the government this year,” Mr Jumazoda said at a press conference.

According to Tajik law, the government has the right to take back up to 25% of a licensed oil and gas area that has failed to produce within seven years of the license being granted. But Tethys, which is listed on the London stock exchange, disagreed with the government’s interpretation of the law.

“The first relinquishment is not due until 2020,” a PR agency speaking on behalf of Tethys told The Conway Bulletin.

This may become controversial as it was in 2008 that the Tajik government awarded Tethys an exploration licence to explore a 36,000 square km area around 100km south of Dushanbe for oil and gas.

But, and this is probably what Tethys’ PR agency was alluding to, the present composition of the Bokhtar Operating Company, owned by Tethys Petroleum, CNPC and Total, was finalised in 2013.

According to Tethys’ calculations, the field holds around 27.5b barrels of oil equivalent of recoverable resources. For Tajikistan, which is resource poor, this is a tantalising prospect.

Tethys is the lead operator of the Bokhtar Operating Company.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Czech company boosts deliveries to Uzbekistan

JAN. 13 2016 (The Conway Bulletin) — Czech engineering company Armatury Group delivered valves worth €3m ($3.3m) to Eriell, a service company operating in Uzbekistan’s oil fields, according to the group’s press release. Eriell, a Russian drilling company, is a supplier to another Russian company, Lukoil, which operates several oil and gas projects in Uzbekistan. The valves will be installed at a compressor station in the South Kemachi oil and gas condensate field, near Uzbekistan’s border with Turkmenistan.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Kabyldin leaves KazTransOil

JAN. 12 2016 (The Conway Bulletin) — Kairgeldy Kabyldin, former CEO of KazTransOil, quit as a director of the company, completing his exit from the Kazakh oil transport company. Earlier in December 2015, Mr Kabyldin quit as CEO of KazTransOil, which is owned by Kazakhstan’s Kazmunaigas. After Mr Kabyldin’s resignation, the board named Nurtas Shmanov as the company’s new CEO. He had been a director of KazTransOil since January 2011. Mr Kabyldin, 63, has worked almost his entire career in Kazakhstan’s oil and gas industry. Analysts expect him to be re-appointed to another role shortly.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)

Stock market: Centerra Gold, Central Asia Metals

JAN. 15 2016 (The Conway Bulletin) — Mining companies in Central Asia had different experiences this week.

In Toronto, Centerra Gold shares fell 6.6% to 7.01 Canadian dollars. The company’s optimistic results published on Jan. 11 gave its shares a short-lived boost at the beginning of the week, but the continuation of the row with the Kyrgyz government may be eroding investors’ confidence.

Kazakhstan-focused Central Asia Metals lost 8.2% in the week, but closed on an upward note at 128.75p on Thursday. Against this trend, KAZ Minerals gained 5% this week, closing at 94.5p.

Oil and gas companies continued to suffer through the lowest oil prices in a decade, now heading below $30/barrel. Tethys Petroleum, which had financial troubles in its operations in Tajikistan, lost 26% in London to close at 2.13p on Thursday. In the past week, Nostrum Oil & Gas shares lost 8.4% to 329.9p. Roxi Petroleum also lost 12.3% to close at 7.13p.

ENDS

(News report from Issue No. 263, published on Jan. 15 2016)