Tag Archives: business

Kyrgyz police raid Kumtor’s Bishkek office

BISHKEK, APRIL 28 2016, (The Conway Bulletin) — Toronto-listed miner Centerra Gold said that police in Bishkek have raided the offices of its wholly-owned Kumtor Gold Company, reigniting a vicious row between the Canadian company and the Kyrgyz government.

According to Kyrgyz officials, police were looking to collect documents related to allegations of financial misconduct by Kumtor.

Centerra said that the government had previously complained about a financial transaction it carried out in 2013. It once again refuted any allegations of criminal activities.

“The company reiterates that such inter-corporate dividend complied with the 2009 agreements governing the Kumtor Project and all applicable Kyrgyz Republic laws. Any claims to the contrary are without merit,” Centerra said in a statement.

On news of the raid, the Toronto stock market briefly suspended Centerra Gold’s shares.

Centerra said mine operations at Kumtor, which is located in the mountainous east of the country, were unaffected.

The Kyrgyz government owns a 32.7% stake in Centerra.

It has been trying to turn this stake in Centerra into a direct stake in Kumtor, the country’s single biggest asset, triggering a major row.

Kumtor represents around 7% of Kyrgyzstan’s GDP and is the country’s most valuable asset.

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(News report from Issue No. 278, published on April 29 2016)

Armenia wants to ban Turkish goods

APRIL 27 2016 (The Conway Bulletin) – Armenian economy minister Artsvik Minasayan said the government is considering a ban on the import of Turkish goods, in retaliation to Turkey’s support for Azerbaijan in the Nagorno-Karabakh conflict. Despite the fact that both Turkey and Armenia are members of the WTO, trade bans can be implemented because, even within the WTO, Turkey does not recognise Armenia.

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(News report from Issue No. 278, published on April 29 2016)

Kazakh oil producers ditch BTC pipeline export route

ALMATY, APRIL 26 2016, (The Conway Bulletin) — Kazakh oil producers have stopped exporting via the Baku- Tbilisi-Ceyhan (BTC) pipeline as they become increasingly cost-conscious during this period of low global oil prices, a shift that will damage Azerbaijan’s reputation as an energy transit route from Asia to Europe

Data from BTC showed that Kazakhstan’s latest contribution to the pipeline was in January. This is the first time in years that Kazakh producers have suspended shipments for more than a month.

This confirms the marginalisation of BTC as an export route for Kazakh producers, most predominantly Chevron-led Tengizchevroil (TCO).

Analysts said the ditching of BTC as an export route for Kazakh oil, a route once heralded as the region’s saviour, was linked to both contractual and market constraints.

“The contract between TCO and BTC for shipments recently ended, and with the CPC pipeline expansion adding new export capacity, there is capacity to export more TCO oil via CPC, which is a more economical option for TCO at low oil prices,” said Andrew Neff, senior petroleum analyst at IHS.

The CPC, Caspian Pipeline Consortium, is an oil pipeline that sweeps around the northern Kazakh shore of the Caspian Sea and ends at the Russian Black Sea port of Novorossiysk. It was designed in the 1990s to ship oil from TCO, Kazakhstan’s largest producer. It’s been gradually expanded and shipped 1.1m barrels/day in March, nearly double its rate of 10 years ago. BTC’s capacity is 1m barrels/day but in March 2016, it transported 721,500 barrels/day.

CPC is a cheaper export route because, to ship oil to the start of BTC, Kazakh producers needs to transport oil across the Caspian Sea.

Mr Neff, the IHS oil analyst, said that as well as hitting BTC’s earnings, dropping Kazakh oil from its mix will also reduce the quality of BTC exports.

“It will change BTC’s overall blend and lower its quality, as Turkmen crude is heavier, plus it will reduce oil transit revenues for Azerbaijan,” he said.

BTC’s main shareholders are BP with a 30% stake and Azerbaijan’s state-owned SOCAR with a 25% stake.

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(News report from Issue No. 278, published on April 29 2016)

Kazakh businessman takes KazKom

APRIL 28 2016 (The Conway Bulletin) – Kazakh businessman Kenes Rakishev was made chairman of Kazkommertsbank, the company said in a statement. KazKom is the country’s largest bank by assets. Marc Holtzman, who previously served as chairman, will now be the CEO. This completes a takeover process that lasted for two years and involved KazKom’s acquisition of debt-ridden BTA Bank. KazKom’s former majority owner Nurzhan Subkhanberdin resigned as chairman last year.

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(News report from Issue No. 278, published on April 29 2016)

Stadler wins Georgian train deal

APRIL 22 2016 (The Conway Bulletin) – Swiss railway rolling stock manufacturer Stadler will send four double- decker trains to Georgia to service its most popular tourist resorts. The Georgian government plans to use the trains to connect the capital, Tbilisi, with three resort towns – Batumi, Kobuleti and Ureki. Stadler has already supplied similar trains to Azerbaijan.

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(News report from Issue No. 278, published on April 29 2016)

EBRD invests in Kazakh trucks

APRIL 27 2016 (The Conway Bulletin) – The EBRD paid €3.3m ($3.8) to become a shareholder in Globaltruck Kazakhstan, a truck operating group. Globaltruck is registered in Cyprus and owns Longrun Asia a start-up trucking company in Kazakhstan. Longrun Asia will use Globaltruck’s equity funds of €10m ($11.4m) to buy up to 300 trucks and trailers.

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(News report from Issue No. 278, published on April 29 2016)

Amec wins Azerbaijani deal

APRIL 26 2016 (The Conway Bulletin) – London-based energy service company Amec Foster Wheeler signed a contract for so-called frontend engineering design at Azerbaijan’s Heydar Aliyev Oil Refinery in Bak. SOCAR, Azerbaijan’s state-owned energy company, awarded the contract. Amec will complete the work by in Q1 2017.

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(News report from Issue No. 278, published on April 29 2016)

Gulf trade corridor becomes operational, Uzbek government says

APRIL 23 2016 (The Conway Bulletin) – Uzbekistan’s government said that an agreement signed in 2011 with Turkmenistan, Iran and Oman to establish what it described as a Central Asia-Persian Gulf Trade Corridor had finally become operational. The deal was agreed to boost trade between the regions. Some analysts, though, have derided the deal as window-dressing.

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(News report from Issue No. 278, published on April 29 2016)

Polymetal output declines in Kazakhstan

APRIL 15 2016 (The Conway Bulletin) – Russian gold miner Polymetal said its output declined by 4% in the first quarter of the year to 260,000 ounces of gold equivalent, also due to a sharp decline in its Kazakh operations. At the Varvara gold project in north-western Kazakhstan, Polymetal produced 14,000 ounces of gold, 32% less than in Q1 2015, due to lower grade stockpiles. Polymetal said its Kyzyl gold project in north-eastern Kazakhstan is on track to start production this year.

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(News report from Issue No. 277, published on April 22 2016)

Lukoil starts Kandym work in Uzbekistan

APRIL 19 2016 (The Conway Bulletin) – Russian oil and gas company Lukoil said it had started construction work at the $3.3b Kandym Gas Processing Complex in south-west Uzbekistan, which will include gas wells, pipelines, compressor stations, storage facilities and a 80MW gas fired power plant. Lukoil will use gas from six fields it is developing with state-owned Uzbekneftegaz to fuel the new plant. Hyundai Engineering will supply the equipment for the plant

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(News report from Issue No. 277, published on April 22 2016)