Tag Archives: business

Oil output drops in Azerbaijan

NOV. 22 2016 (The Conway Bulletin) — Azerbaijan expects total oil output next year to measure 39.8m tonnes, down from 41.3m tonnes this year, Russia’s Interfax news agency reporting quoting a government official. Oil is Azerbaijan’s most valuable commodity, although it is developing gas exports. The downturn confirms a general drop in production from Azerbaijan’s aging infrastructure despite a boost in investment.

ENDS

(News report from Issue No. 306, published on Nov. 25 2016)

Kazakhstan operating Tethys revenue drops

NOV. 15 2016 (The Conway Bulletin) — Guernsey-registered Tethys Petroleum posted a 46% decline in revenues in Q3 2016, compared to the same period last year, due to a production slump and a decrease in the price that its Kazakh customers pay for its oil and gas supplies. The company said that average production declined by 57% to 742 barrels/day as production cost increased. In a separate corporate note, the company said that a Kazakh prosecutor had dismissed allegations of misconduct against its subsidiary, but said that its assets remained frozen.

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(News report from Issue No. 305, published on Nov. 18 2016)

Kyrgyz MPs blame EEU for blocking meat exports

BISHKEK, NOV. 17 2016, (The Conway Bulletin) — Kyrgyz MPS blamed the Eurasian Economic Union for unfair restrictions which have slowed meat exports.

The criticism of the Eurasian Economic Union, and the implied bias towards the bigger member states, is just the latest attacked on the Kremlin-led economic bloc from Kyrgyz politicians and businesses who have always been sceptical of the benefits of joining.

Earlier this year, Kyrgyz president Almazbek Atambayev said that the Eurasian Economic Union had actually resulted in a drop in exports and also created mountains of extra red tape for businesses to deal with.

In parliament, Kyrgyz PM Sooronbai Jeenbekov said that meat producers have not been able to export to Eurasian Economic Union states since it joined the bloc because of alleged sanitary infractions.

“Kyrgyzstan fulfils all terms of the Eurasian economic union,” he said. “But protection of individual interests does not contribute to the deepening and strengthening of integration as a whole.”

A few weeks ago, Kyrgyz president Almazbek Atambayev accused Kazakhstan, also a Eurasian Economic Union member, of reneging on a promise to build a new site on the border that would have allowed Kyrgyz producers to receive the necessary paperwork needed to export meat. He alleged that Kazakhstan was trying to prevent Kyrgyz meat imports to stamp out competition.

Like the rest of the Central Asia and South Caucasus region, Kyrgyzstan has been dealing with an economic downturn since 2014 linked to a fall in oil prices that triggered a recession in the Russian economy. Kyrgyz timing in joining the Eurasian Economic Union in August 2015 means that it has become even more tightly bound to Russia.

The Eurasian Economic Union includes Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

EDB to support Tajik Nurek

NOV. 11 2016 (The Conway Bulletin) — The Russo-Kazakh Eurasian Development Bank (EDB) said it is ready to consider supporting the modernisation of the Nurek hydropower plant, the largest in Tajikistan. In an interview with Avesta, EDB chairman Dmitri Pankin said that, if the government asked for help, the EDB would help fund reconstruction work at the dam together with the World Bank and the Asian Development Bank. The Tajik government had previously said the modernisation will cost $700m.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

International Bank of Azerbaijan loans clear up

NOV. 14 2016 (The Conway Bulletin) — In a half-year report, the International Bank of Azerbaijan (IBA), the country’s largest lender, said it completed the first stage of a cleanup of its toxic assets. In the first half of 2016, IBA transferred 9.9b manat (around $6b) to the government-owned credit company Aqrar Kredit. Azerbaijan’s ministry of finance owns 54.9% and Aqrar Kredit owns 27% in IBA.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

Turkmenistan makes a deal with EU

NOV. 11 2016 (The Conway Bulletin) — At a meeting in Brussels, Turkmen and EU energy officials confirmed their commitment to making the so-called Caspian Development Corporation, which aims to send gas from Turkmenistan to Europe, become a reality. The Caspian Development Corporation is a concept that has been talked of and worked towards since at least 2010. One of the projects Caspian Development Corporation is exploring is building a pipeline across the Caspian seabed.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

Azerbaijan’s SOCAR to build terminal in Benin

NOV. 15 2016 (The Conway Bulletin) — During an official visit, a delegation from SOCAR, Azerbaijan’s state owned energy company, said it was interested in building an oil terminal in Cotonou, the capital of Benin. The SOCAR officials didn’t say why they were interested in building an oil terminal in Benin. Azerbaijan’s energy minister Natig Aliyev also visited Burkina Faso’s PM Paul Kaba Thieba and discussed potential cooperation between SOCAR and SONABHY, the coun- try’s state energy company.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

KMG EP revenue rises in Kazakhstan

NOV. 17 2016 (The Conway Bulletin) — London-traded KMG EP, a subsidiary of Kazakhstan’s state-owned energy company Kazmunaigas, posted a 47% increase in tenge-denominated revenue in the first nine months of 2016, compared to the same period last year, mostly due to the weaker tenge/US dollar exchange rate. Production fell by 1.2%, mainly because of a 6% drop at its PetroKazakhstan subsidiary, which operates in the central Kyzylorda region.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

Stock market: Tethys Petroleum,Olisol

NOV. 18 2016 (The Conway Bulletin) — After hovering at around 1.5p for several months, Tethys Petroleum’s share price reached rock bottom at around 0.9p in early November, following increasingly worse news coming from its operations in Kazakhstan.

Its prospective local partner, Olisol, first missed a payment of 9.8m Canadian dollars ($7.3m) and later cancelled Tethys’ gas sales contract in Kazakhstan. It then pulled out completely from its initial offer to become a major shareholder in Tethys.

In addition, Tethys’ local subsidiaries were raided by the Kazakh police and their asset frozen.

The stock price picked up again this week after new potential investors came forward and a Kazakh court dropped the charges against the local subsidiaries. But with much work still to be done before a financing agreement is reached and with a pending legal dispute in Tajikistan, Tethys is far from having found a safe harbour.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)

Business Comment: Azerbaijan’s hunt for partners

NOV. 18 2016 (The Conway Bulletin) — Despite slowing domestic production and overall exports, Azerbaijan is stubbornly reaching out to building partnerships with other countries to sell its oil.

Last week, the government and state-owned SOCAR mulled the launch of a pilot programme with Egypt to send 2m barrels of oil to refine in Egyptian plants. In recent weeks, Azerbaijan also planned to send oil to Belarus and Ukraine and to build an oil terminal in Benin, of all places.

Sending oil to its former Soviet sisters Belarus and Ukraine would probably be feasible from a technical point of view, but analysts have shown that Azerbaijan might just not have enough oil to provide for its domestic demand and for the pipeline contracts it already has in place.

SOCAR is sending increasingly less oil through its main export pipelines, posting a 4% decrease via Baku-Tbilisi-Ceyhan, an 11% decrease via Baku-Supsa and an 11% decrease via Baku-Novorossiysk in the first ten months of 2016.

And in the first three quarters of the year, SOCAR posted an 8.7% fall in production due to the drop in the price of oil.

SOCAR’s poor performance in 2016 begs the question of whether the company’s bullish plans to export oil to new destinations and invest in West Africa make economic and financial sense. If there is any sense in this at all, it is difficult to find.

With oil prices still hovering around $50/barrel, SOCAR and its multinational partners in Azerbaijan will maintain low production figures, and this will certainly not boost exports.

The question is, now, who does Azerbaijan turn to to boost its client base.

ENDS

(News report from Issue No. 305, published on Nov. 18 2016)