Author Archives: admin

Cement production to boost in Tajikistan

DEC. 16 2015 (The Conway Bulletin) — The lower house of Tajikistan’s parliament ratified a $145m investment deal to boost cement production in the country. Under the agreement, a Tajik-Chinese joint venture will build three new facilities, including a cement plant with a capacity of 1.2m tonnes in the Yovon district, 40km south of Dushanbe. Three unnamed Chinese businessmen will own 75% of the joint venture and the Tajik government will retain the remaining 25%.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Uzbekistan rejects SCO free trade zone

DEC. 17 2015 (The Conway Bulletin) – Uzbekistan is not prepared to support the creation of a free trade zone with the Shanghai Cooperation Organisation (SCO) as some other members have suggested, first deputy PM Rustam Azimov told media. Russia and China dominate the SCO which is focused on Central Asia.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Georgia to build ski resort

DEC. 15 2015 (The Conway Bulletin) — The Georgian government said the development of the Gudauri ski area will cost around $150m to build, the first time that a price tag has been put on plans to give the country what officials say will be a world-class winter sports resort. Canadian mountain resort developers Ecosign and consulting firm Ernst&Young have drawn up plans to develop infrastructure at Gudauri, a ski resort around 120km north of Tbilisi. The government’s Partnership Fund is set to be one of the biggest investors in the project.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Business comment: Kazakhstan’s Oil Production

DEC. 20 2015 (The Conway Bulletin) — He must thinks we’re fools.

“We did all we could to keep oil prices high by cutting oil production domestically, now it’s time for other countries to do the same,” Kazakhstan’s minister of energy Vladimir Shkolnik told the press in Astana.

He attributed this year’s 1.5m tonnes production cut in Kazakhstan’s oil output to a deliberate decision to help keep oil out of the market to try to raise prices. If this was the intention, it clearly hasn’t worked, because prices are down to a seven-year low, at around $37/barrel.

But, incidentally, this was not the intention.

As several experts have told the Bulletin throughout the year, Kazakhstan only produces around 2% of the world’s total oil output and does not have a seat at price- setting assemblies such as OPEC.

This makes it a price taker, one that cannot, even by freezing completely oil exports, bring back oil prices above $100/barrel.

A 1.5m tonne cut represents roughly a 2% cut in Kazakhstan’s yearly production and is entirely attributable to aging oil fields and delays in the start of new projects.

The re-start of production at the Kashagan oil field in the Caspian Sea is now looming on the horizon, but at the ministry of energy its production forecast is lower than previously assessed.

Tengizchevroil, the consortium operating Kazakhstan’s largest field, finally said it would go ahead with its expansion project in H1 2016, two years behind schedule and with a $15b cost overrun.

So please, Mr Shkolnik, don’t say you cut production on purpose. The main reason that Kazakh output has dropped is because low oil prices have discouraged production.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Stock market: Tethys, Nostrum, Tengri

DEC. 17 2015 (The Conway Bulletin) — Commodities prices keep declining and the industry continues to worry and use caution. This is reflected in the markets, which show the poor performance of Central Asia and South Caucasus focused firms.

Tethys Petroleum (-6% in the past week), Nostrum Oil & Gas (-5.8%) and Roxi Petroleum (-4%) were hit by oil prices plummeting to around $37/barrel.

Industrial and judicial news affected the performance of several miners in the region.

KAZ Minerals closed at 88.5p on Thursday a 7.7% fall in share prices compared to last week. Centerra Gold lost 11% on the Toronto Stock Exchange, closing at 7.07 Canadian dollars on Thursday.

Generally stable Tengri Resources also fell after it announced it was not going to mine the Taldybulak gold and copper project in Kyrgyzstan. It lost 17.4% in one day to close at 3p per share on Thursday.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Kyrgyz President visits Kuwait

DEC. 14 2015 (The Conway Bulletin) – Kyrgyz president Almazbek Atambayev flew to Kuwait to open Kyrgyzstan’s new embassy. Mr Atambayev wants to boost ties with the Gulf states. He clearly considers this important as, with budgets under pressure, he has prioritised extending Kyrgyzstan’s diplomatic reach over other issues.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Turkmen state workers receive salaries in bonds

DEC. 14/19 2015 (The Conway Bulletin) – Sources working in Turkmenistan’s public sector told the opposition website Chronicles of Turkmenistan that from January 2016 the state will start paying part of government employees’ wages in bonds in order to save money.

A few days later, the state-run news agency confirmed the government was going to start issuing 5-year bonds, although it didn’t specify how the bonds would be distributed. It did say, though, that the main aim of the bonds was to develop Turkmenistan’s financial markets.

The Chronicles of Turkmenistan, which is a well-respect website, instead said that several government agencies would pay “12% or more of the salary” in government bonds.

Although rich in energy resources, Turkmenistan has had to adjust to the economic malaise that is pervading the Central Asian region.

The news flow from Turkmenistan is weak but there are signals that the economic downturn is hurting.

Chronicles of Turkmenistan also speculated that the cash withheld from government salaries would be used to pay for the 2017 Asian Indoors Games in Ashgabat.

In January 2015, Turkmenistan devalued its manat currency by 20%. Last month, the government allegedly banned public officials from withdrawing US dollars at exchange points.

Giving government workers bonds instead of cash effectively means deferring salary payments.

In October, the government said it would draft a plan for the sale of government companies in 2016, effectively an admission that it was running out of cash. The bond scheme is another attempt by to cut costs.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

GM prices up in Uzbekistan

DEC. 15 2015 (The Conway Bulletin) — GM-Uzbekistan, General Motors car-making venture in Uzbekistan, increased retail prices across its product line by up to 30%, the podrobno.uz news agency reported. Like the rest of the region, Uzbekistan has been facing a devaluation in its sum currency while inflation has increased.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Iran hints at increasing stake in the Azerbaijani Shah Deniz

DEC. 15 2015 (The Conway Bulletin) — Iran has said it is interested in increasing its stake in the Shah Deniz offshore gas exploration project in Azerbaijan, a move that would extend Iran’s influence over a project that is becoming increasingly important in Europe’s future energy plans.

Iran’s deputy minister Hossein Zamani Nia said Iran wanted to increase its stake in several international projects. “Several fields and projects in some countries are being examined,” Mr Zamani Nia told the IRNA news agency.

“Shah Deniz is one of those fields but a final decision has not yet been made.”

Through the subsidiary Naftiran Intertrade, state-owned National Iranian Oil Company (NIOC) owns a 10% stake in Shah Deniz, off the coast of Azerbaijan in the Caspian Sea.

BP is the project leader at Shah Deniz with a 28.8% share in the consortium. Turkey’s TPAO owns 19%, Azerbaijan’s SOCAR owns 16.7%, Malaysia’s Petronas controls 15.5% and Lukoil owns the remaining 10%.

The consortium is working on a second development phase of the project, which will more than double the field’s output.

The additional volumes will fill new westward pipelines, such as TANAP, which will pump gas to Turkey and Europe.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)

Georgia moves towards EU visa-free entry treaty

DEC. 18 2015 (The Conway Bulletin) – The European Commission said that Georgia had passed its benchmark test required for it to be eligible for a visa-free treaty with the EU, a major step towards the Georgian government’s key foreign policy objective of integrating more closely with the West.

It’s now expected that the European Parliament will vote sometime in the first half of next year on whether to formally allow Georgians visa-free entry to the Schengen region.

The Schengen region is named after the town in Luxembourg where EU members states struck a deal to ease travel requirements. Britain and Ireland, both EU members, declined to sign up to the deal. Norway, Ice- land, Switzerland and Liechtenstein are non-EU members who have signed up to the agreement.

And Georgia’s leaders appeared confident the European Parliament would vote to allow them easier access to Europe.

PM Irakli Garibashvili called it a historic day.

“Our country has confirmed once again that we are frontrunners among EU’s Eastern Partnership countries,” he said. “In response, Europe tells us that it is open for Georgian citizens.”

If the European Parliament did vote to allow Georgians visa-free entry it could irritate Russia which is sensitive about former Soviet states moving towards the West.

ENDS

(News report from Issue No. 261, published on Dec. 20 2015)