OCT. 4 2016 (The Conway Bulletin) – LG CNS, the IT provider owned by Korea’s LG, signed a $12.1m contract with Uzbekistan’s ministry of IT and communications to build a national online electronic library system. The project will be started at the Navoi national library and will then be expanded to education institutions, government agencies and airports.
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(News report from Issue No. 299, published on Oct. 7 2016)
OCT. 8 2016 (The Conway Bulletin) – CRRC, China’s state-owned train manufacturer, signed an agreement with state-owned Georgian Railway to supply 28 new electric locomotives and jointly build a factory to produce trains in the country. The new $20m factory, located near Tbilisi, will be operated by CRRC and local companies BMI Partners and AS Group 1990. The joint venture aims to create an export hub for train parts to Europe and Turkey.
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(News report from Issue No. 299, published on Oct. 7 2016)
OCT. 6 2016 (The Conway Bulletin) – Natig Aliyev, Azerbaijan’s energy minister, said that, once operational, the Kashagan offshore will increase Kazakhstan’s oil shipments to Baku to 150,000 barrels of oil/day, feeding into the Baku-Tbilisi-Ceyhan pipeline. Mr Aliyev’s statement relied on the assumption that the Caspian Pipeline Consortium, which pumps oil around the Caspian Sea to the Russian port of Novorossiysk, and the Kazakhstan-China pipeline will not be able to absorb the additional 370,000 barrels of oil/day that Kashagan will produce at its peak. Kazakhstan has slashed oil shipments from Aktau to Baku this year.
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(News report from Issue No. 299, published on Oct. 7 2016)
SEPT. 30 2016 (The Conway Bulletin) – Azerbaijan’s parliament approved a deal to build the TANAP pipeline across Turkey, a long-overdue step in the development of the project to pump gas from the Caspian Sea to Europe. An initial agreement on TANAP, a $10b gas pipeline, was signed in May 2014.
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(News report from Issue No. 299, published on Oct. 7 2016)
OCT. 4 2016 (The Conway Bulletin) – The Anaklia Development Consortium started construction at the $2.5b Anaklia Deep Sea Port, just north of Poti, on Georgia’s Black Sea coast. At the groundbreaking ceremony, Georgia’s PM Giorgi Kvirikashvili said the port will be complete by 2020. TBC Holding and US-based Conti are part of the consortium. Mamuka Khazaradze, chairman of TBC Bank, owns TBC Holding.
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(News report from Issue No. 299, published on Oct. 7 2016)
ALMATY, OCT. 5 2016 (The Conway Bulletin) — Kazakhstan-focused copper producer Central Asia Metals reported a 38% growth in production in Q3 2016 compared to the same period last year, because of the expansion of its Kounrad project near Lake Balkhash.
The company, listed in London, said it could potentially surpass its goal of producing 14,000 tonnes of copper this year. In the first nine months of the year, it produced 11,010 tonnes of copper cathode, up 31% compared to last year.
The news sent its shares up 3.6% to 181.75p, its highest level since April. The depreciation of the Kazakh tenge after the Central Bank ditched the peg to the US dollar in August 2015 also helped the company cut production costs which should help its full-year results.
“As a result of the devaluation of the tenge as well as some engineering cost savings, we remain confident that we can complete this capex programme approximately 25% below our initial budget of $19.5m,” chairman Nick Clarke said.
Central Asia Metals mainly exports its copper products to Turkey. Its exposure to other markets is limited.
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(News report from Issue No. 299, published on Oct. 7 2016)
SEPT. 29 2016 (The Conway Bulletin) – Abdulaziz Kamilov, Uzbekistan’s foreign minister, paid an official visit to Tajik President Emomali Rakhmon in Dushanbe in an effort to boost cooperation. Mr Kamilov and Mr Rakhmon held talks on joint efforts to combat terrorism and on water and energy issues that still divide the two countries. Uzbekistan has maintained strong opposition against Tajikistan’s decision to build a major dam and hydropower plant because it would affect downstream water supply.
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(News report from Issue No. 298, published on Sept. 30 2016)
SEPT. 27 2016 (The Conway Bulletin) – The EBRD said it may withhold funds for a pipeline linking gas fields in the Caspian Sea to consumers in Europe until Azerbaijan agreed to provide more transparency into its state linked energy companies.
Taking a tough stance, the EBRD, a London-based intra-governmental bank set up during the collapse of the Soviet Union to fund business and infrastructure projects, said unless Azerbaijan complied with the Extrac- tive Industry Transparency Initiative (EITI), it would withhold $1.5b ear- marked for the TANAP pipeline.
The EBRD’s stance casts fresh doubts over the Azerbaijani leadership’s commitment to transparency into its business dealings.
Riccardo Puliti, the EBRD’s managing director for energy, said that EITI, considered a global benchmark for transparency in the extractive sectors, would consider whether Azerbaijan had made progress at its next meeting in Kazakhstan in October.
“In the case of TANAP, it is important that this progress takes place. If there is no progress it will be quite difficult to justify a large amount of financing,” he told Turkish media.
Last year, the EITI downgraded Azerbaijan from ‘compliant’ to ‘candidate’ country and criticised it for a lack of transparency.
TANAP will link Azerbaijan’s pipe- line network to Greece via Turkey, forming part of the Southern Gas Corridor. SOCAR, Azerbaijan’s state- owned energy company, owns a 58% stake in TANAP, Turkey’s Botas (30%) and BP (12%) own the rest. TANAP will link with TAP which will pump the gas to Italy.
Azerbaijan has yet to react to the EBRD’s statement.
Aliya Tskhay, a researcher focus- ing on Azerbaijan at the University of St Andrews said that the EBRD may have been trying to encourage Azerbaijan to engage more closely with the EITI.
“The EBRD request seems to be an encouragement for Azerbaijan’s government to still be part of the EITI, despite a status downgrade last year,” she said.
TANAP will cost $10b to build, while TAP has a price tag of around $5b.
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(News report from Issue No. 298, published on Sept. 30 2016)
SEPT. 27 2016 (The Conway Bulletin) – Kazakhstan’s national telecoms operator Kazakhtelecom said in a financial statement that its operating profit grew 13.2% in H1 2016, compared to the same period last year. Revenues increased by 4.9%, mainly due to higher prices for its telecoms networks that it rents out to other companies. The merger of Altel, part of Kazakhtelecom, and Tele2 helped overall profits, which more than doubled in the first six months of the year.
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(News report from Issue No. 298, published on Sept. 30 2016)
TBILISI, SEPT. 29 2016 (The Conway Bulletin) — Georgian-Iranian company GEOPARS signed a deal with the Georgian government to build an oil refinery in Supsa on the Black Sea coast, the first to be built in Georgia for 80 years.
According to local media, the government licensed the land to GEOPARS for free. GEOPARS said it would need to make an investment of $1.5b to build the refinery, a petro- chemical plant and a logistical centre.
PM Giorgi Kvirikashvili attended the signing ceremony and hailed its impact on Georgia’s industrial sector.
“We will see a project that once again accentuates and reinforces Georgia’s regional role as the shortest route to Europe for Near East and Asian countries. This is a project that puts Georgia on a map by highlighting not only its transit function, but its industrial role as well,” local media quoted him as saying.
Caution is needed, though. Georgia has negotiated building an oil refinery in Supsa or Poti several times previously with Azerbaijani, Kazakh and Russian investors but the deals eventually fell through.
SOCAR Georgia Investments, a subsidiary of Azerbaijan’s state owned energy company SOCAR, had proposed building a refinery in Supsa in May, but failed to commit funds.
This is the first refinery deal in Georgia made with Iran, which has played an increasingly active role in the South Caucasus over the past few years. If the project does go ahead, it will give Iran an important foothold in Georgia, a close US ally.
The only major oil refinery previously built in Georgia was at Batumi in the 1930s. The Batumi refinery was downgraded in the 1990s and sold to Kazakh investors. It later became an oil terminal.
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(News report from Issue No. 298, published on Sept. 30 2016)