Tag Archives: hydrocarbons

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.

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)

Kazakhstan’s Kashagan provides oil update

NOV. 14 2016 (The Conway Bulletin) — Kazakhstan’s giant Kashagan oil field produced 1.5m barrels of oil in its first month of operations, official media reported. In daily terms, Kashagan produced an average of 52,600 barrels, far below the minimum threshold of 75,000 barrels/day that the consortium said it needs to produce to keep extraction commercially viable. The Kazakh government had previously said it expects Kashagan to reach an average of 90,000 barrels/day before the end of the year.

ENDS

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

Russneft adds assets in Azerbaijan

NOV. 15 2016 (The Conway Bulletin) — Ahead of a planned IPO in Moscow, Russian energy company Russneft said it will add oil and gas assets in Azerbaijan to its balance sheet in 2017. The 15b cubic metres of gas and 11.2m tonnes of oil holdings in Azerbaijan were owned by Global Energy Azerbaijan. Russian billionaire Mikhail Gutseriev owns a majority share in Russneft and owned Global Energy Azerbaijan before it was bought by Russneft in 2014. Oil trading giant Glencore owns a minority stake in Russneft.

ENDS

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

Georgia begins East-West pipeline construction

NOV. 16 2016 (The Conway Bulletin) — Georgian Oil and Gas Corporation said it started construction on a section of the East-West gas pipeline, from Tsiteli Khidi on the border with Azerbaijan to Gardabani. The company said it will invest 4.5m lari ($1.4m) to complete the 20km section. Georgia ordered a general overhaul of the 450km Soviet-era pipeline from the border with Azerbaijan to the Black Sea port of Poti. State-owned Partnership Fund is the only shareholder.

ENDS

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