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GAIL wants 5% of Turkmen pipeline project TAPI

DEC. 27 2016 (The Conway Bulletin) — Indian gas distributor GAIL said it wants to buy a 5% stake in the TAPI pipeline project, two weeks after construction started on the 1,700km pipeline that will run from Turkmenistan to India. TAPI will pump 33b cubic metres of Turkmen gas to India per year, via Afghanistan and Pakistan. It is expected to come online in 2019. Turkmenistan’s state-owned Turkmengaz is the operator of the project.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Service companies sign deals with Azerbaijan

DEC. 22-29 2016 (The Conway Bulletin) — Norway’s Agility, Britain’s KCA Deutag and British-Azerbaijani joint venture SOCAR-Cape all signed contracts with BP and Azerbaijan’s state-owned energy company SOCAR to provide services to off- shore energy projects in the Caspian Sea. These separate deals show Azerbaijan’s reliance on Western technology to operate and service its oil and gas projects.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Kazakh government cuts flour subsidies

JAN. 6 2016, ALMATY (The Conway Bulletin) — Bread prices are beginning to rise in Kazakhstan after the government cut flour subsidies, people working in the bread-making sector told The Bulletin.

The Kazakh government ended its subsidies for flour on Jan. 1, a move it flagged up in November as part of an overhaul of government spending designed to counter an economic slowdown. It has defended dropping subsidies as fair because it means that
the money saved can be re-focused on benefits for poorer sections of society. Asylzhan Mamytbekov, minister for agriculture, has said that flour subsidies were costing the government 9b tenge a year ($26m).

But the impact of the subsidy cut on bread-makers is already being felt.

In Almaty, Yerbol Beisembayev was going about his business buying bread from factories and re-selling loaves to shops. He said that a couple of factories had already closed because the cut in flour subsidies had made them unprofitable.

“Now everything will depend on who will get the best price for the flour,” he said. “The government has allowed bread (prices) to free float, just like the tenge.”

In August, the Central Bank ditched the tenge’s peg to the US dollar. This sent the value of the tenge crashing by around 40%.

It appears that, for now, bread producers are preferring to soak up the extra cost of the flour rather than pass it on to consumers. Most shops selling bread in Almaty said there had been a small price rise of 5 tenge a loaf — roughly 8%. This below the doubling of prices that analysts had predicted once flour subsidies were cut.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Inflation accelerates in Kazakhstan

JAN 5 2016 (The Conway Bulletin) – Annualised inflation in Kazakhstan hit 13.6% for the 12-months to the end of December, its highest rate for six years, the National Statistics Committee said. Inflation shot up in October after the tenge depreciated. In September, annualised inflation in Kazakhstan measured just 4.4%.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Kyrgyzstan’s Toktogul hydropower station breaks down

DEC. 23 2015, BISHKEK (The Conway Bulletin) — Kyrgyzstan’s largest hydropower station, Toktogul, broke down after a power surge knocked out three of its four generators, forcing the government to buy extra electricity from Kazakhstan.

The breakdown at Toktogul is embarrassing for Kyrgyz President Almazbek Atmabayev because three months ago, after the completion of a transmission line linking the power- generating south with the power consuming north, he proclaimed Kyrgyzstan was self sufficient in power. Kyrgyzstan also aims to export power to Pakistan from 2018.

Engineers working on Toktogul, which was built in 1976, said they expected the power plant to be back up and running from mid-January.

In the meantime, Kyrgyzstan announced a deal to buy electricity from neighbouring Kazakhstan to cover the shortfall.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

4G licences expand in Kazakhstan

DEC. 30 2016 (The Conway Bulletin) — The Kazakh government said it has allowed local telecom operators to provide 4G services to their customers . State-owned Kazakhtelecom’s subsidiary Altel had been the only company that could use the 4G network. Other companies may now offer 4G data services, giving a much-needed competitive boost to Kazakhstan’s telecoms sector.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Georgia’s wine exports fall

JAN. 5 2016 (The Conway Bulletin) – Georgia exported 39% less wine in 2015 than it did in 2014 because of a worsening recession in Russia and a protected civil war in Ukraine. In a press release, Georgia’s National Wine Agency said that wine exports to China had increased by 22% to 2.7m bottles but that sales to Russia had fallen by 51% to 18.3m bottles and to Ukraine by 56% to 3.4m bottles.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Russia cuts Turkmenistan gas imports in 2016

JAN. 4 2016, TBILISI (The Conway Bulletin) — Amid low energy prices and economic strains, Russia’s state- owned Gazprom is reshaping its gas relations with countries in the South Caucasus and Central Asia.

It is effectively buying gas from Central Asia to sell on to Europe, China and, partly, to the South Caucasus.

Gazprom confirmed it will stop gas imports from Turkmenistan and, at the same time increase purchases from neighbouring Uzbekistan to 3.1b cubic metres.

“The basis for this decision is the changed situation on the international gas market, as well as certain economic and financial issues arising from the Gazprom’s exports,” it said in a statement.

Gazprom didn’t release price details with either Turkmenistan or Uzbekistan but its statement did confirm shifting alliances in Central Asia. Previously, Russia had imported heavily from Turkmenistan. This flow, though, has fallen as relations between the two countries grew increasingly strained. Turkmenistan wants to supply Europe with gas, via Azerbaijan and Turkey, putting it in direct competition with Russia.

Last year, Turkmenistan effectively signalled that Russia had stopped paying for its gas.

But Gazprom needs to buy Central Asian gas to honour its deals with China and Europe, as well as making new deals in the South Caucasus.

Gazprom already supplies Armenia with gas and is negotiating export deals with Georgia and Azerbaijan who both need to meet domestic power consumption.

Rovnag Abdullayev, president of Azerbaijan’s state-owned energy company SOCAR, met with Alexei Miller, Gazprom’s CEO, in December to discuss 2016 volumes.

“The possibility of increasing [Russian gas] supplies taking into account the prospects for growth in natural gas consumption in the country was considered,” SOCAR said in a statement.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

China supplies trains to Uzbekistan

DEC. 26 2016 (The Conway Bulletin) — A Chinese consortium has supplied 11 locomotives to Uzbekistan as part of an ongoing partnership. CNTIC and CNR Dalian fulfilled a $44.39m contract they signed with Uzbekistan’s railway company in 2011. A loan from China EximBank financed 95% of the cost.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)

Foreign currency savings rise in Kazakhstan

JAN 6 2016 (The Conway Bulletin) – The proportion of cash in banks in Kazakhstan held in foreign currencies rose to 77.5% in November from 76.4% a month earlier, media reported quoting the Central Bank, highlighting people’s lack of confidence in the national currency. It has been a long-held Central Bank policy to try to persuade people to keep their savings in tenge. The tenge, though, lost around half its value in 2015.

ENDS

(News report from Issue No. 262, published on Jan. 8 2016)