Tag Archives: hydrocarbons

Azerbaijan’s energy company to build Malta gas power station

JUNE 5 2016 (The Conway Bulletin) — Azerbaijan’s state-owned energy company SOCAR said it will start building a gas-fired power station, fed by liquefied natural gas (LNG), in Malta by the end of year, ending years of delays for the project.

ElectroGas will build the 215MW LNG-to-power plant at the Delimara port, on the eastern Maltese coast, and will be its exclusive gas supplier. Switzerland-based SOCAR Trading, Germany’s Siemens and US-based General Electric own ElectroGas.

Media quoted SOCAR representatives as saying that “the facility will be commissioned before the end of the year.” They did not say how much it would cost to build, although Maltese media have speculated between $500m and $1b.

In effect the site is a large LNG terminal with a power plant attached. Malaysia’s Bumi Armada, an offshore services company, is building the $300m LNG storage facility at Delimara in Q3 2016. The floating terminal will have a capacity of around 95 tonnes of LNG.

Maltese media has repeatedly attacked the government for the delays in the commissioning of the power plant. Malta needs to boost its power generation capacity.

Earlier in 2015, Malta’s Auditor General launched an investigation into potential abuse of power by energy minister Konrad Mizzi, who had allegedly interfered in the purchase of fuel from SOCAR.

ENDS

(News report from Issue No. 284, published on June 10 2016)

Russia and Turkmenistan discuss gas deal

MAY 31 2016 (The Conway Bulletin) — Russia’s gas giant Gazprom said it may resume gas imports from Turkmenistan, less than a year after bad- tempered rows over prices led to the Kremlin scrapping shipments of gas.

Alexander Medvedev, deputy chairman at Gazprom, said the parties were still in talks and it was too early to say whether a settlement can be reached.

“There is a window of opportunity. We are ready to negotiate, but, unfortunately, there is no clear road- map,” Mr Medvedev told the press.

Even just the decision to negotiate signals a U-turn by Russia and Turkmenistan over both their gas policies and relations in general.

At one point during the various arguments in 2015, Gazprom took the Turkmen government to court to try to force it to reduce gas prices.

China has become Turkmenistan’s favoured destination for its gas exports since a pipeline connection was completed in 2009.

But now, facing delays in the section of the pipeline that crosses Kyrgyzstan, China has pushed back its investment plans for the giant Galkynysh gas field in Turkmenistan.

This is likely to frustrate Turkmenistan, which bet heavily on China as an alternative to Russia, and could provide an opportunity to resume gas trade with Gazprom.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Azerbaijan’s energy company reorganises its assets in Turkey

JUNE 1 2016 (The Conway Bulletin) — SOCAR Turkey Enerji, a subsidiary of Azerbaijan’s state-owned energy company, has said it wants to buy stakes in a pipeline and a lubricants company and sell a stake in a refinery, in a major shake up of its operations in Turkey.

SOCAR Turkey Enerji said it is interested in buying OMV Petrol Ofisi, a subsidiary of the Austrian energy company that produces fuel and lubricants in Turkey. To secure the deal, the Azerbaijani company will have to beat competition from Chinese and Japanese companies.

“SOCAR has an interest in this deal. We are waiting for the company to submit information on these assets,” Zaur Gakhramanov, the company’s head, told local media. He also said his company wants to buy a 7% stake in TANAP, the Trans-Anatolian gas pipeline, from SOCAR, which owns a 58% stake in the project.

Perhaps adding to the company’s expansion plans, Mr Gakhramanov also said that SOCAR Turkey Enerji plans an IPO in 2020 for 49% of its shares. He did not say where the company’s shares would list.

But this year SOCAR Turkey Enerji has also looked to sell.

In May, it said it wanted to sell off its shares in Turkey’s petrochemical complex Petkim. In March SOCAR Turkey Enerji cut its share in Petkim from 8.07% to 5.32%. SOCAR Turkey Petrokimiya, another SOCAR subsidiary, still owns 51% of the project.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Kazakhstan wants better Karachaganak deal

ALMATY, JUNE 2 2016 (The Conway Bulletin) — The Kazakh government has rejected a $300m settlement for a $1.6b fine it levied at the consortium of companies developing Karachaganak, the FT reported quoting Kanat Bozumbayev, Kazakhstan’s energy minister, fuelling speculation it may want to leverage a bigger stake in the project.

Mr Bozumbayev said the government had dismissed a settlement offer from the consortium.

“It has already returned the investment shareholders made, and now it will give Kazakhstan profits, so we are negotiating,” Mr Bozumbayev said.

This week, Bloomberg quoted unnamed sources as saying that Kazakhstan is seeking to increase its share in the consortium, led by Eni (29.25% stake), Shell (29.25% through BG), Chevron (18%), Lukoil (13.5%) and state-owned Kazmunaigas (10%).

Kazmunaigas gained its 10% stake in Karachaganak in 2011 after settling a lawsuit against the consortium for tax evasion and environmental damage.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Refinery capacity rises in Turkmenistan

MAY 31 2016 (The Conway Bulletin) — Turkmenistan’s ministry of oil and gas said it wants to double oil refining capacity in the country over the next three years, in an effort to increase the domestic output of oil products. The ministry said it plans to increase capacity to 20m tonnes by 2020 and then to 30m tonnes by 2030. Last year, Turkmenistan missed its goal of reaching its refining capacity of 15m tonnes. It currently only process around 11m tonnes/year.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Russia to ship oil to China, via Kazakhstan

MAY 30 2016 (The Conway Bulletin) — Nurtas Shmanov, head of Kazakhstan’s pipeline operator KazTransOil, said the company is ready to increase shipments of Russian oil to China via a Kazakh pipeline from 7m to 10m tonnes/year. Mr Shmanov said the pipeline wouldn’t need to be expanded to carry out the operation, effectively hinting that Kazakhstan could downsize its own oil exports to China.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Azerbaijan readying a 2nd Eurobond

JUNE 1 2016 (The Conway Bulletin) — Azerbaijan’s state-owned Southern Gas Corridor company said it will issue a second $1b Eurobond by the end of 2016 or early next year, Bloomberg reported. The Southern Gas Corridor, which is in charge of a pipeline network that will connect Azerbaijan’s gas fields with European consumers by 2019, issued a $1b Eurobond in March. Sustained low oil prices have hit the financial feasibility of several large infrastructure projects across the region.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Kazakhstan’s oil pipeline company grows by 2%

MAY 30 2016 (The Conway Bulletin) — Revenues for KazTransOil, Kazakhstan’s state-owned oil pipeline company, grew by 2% to 54.7b tenge ($164m) in Q1 2016, compared to the same period last year. As capital expenditures almost halved to 6.6b tenge ($20m), analysts remain confident that the company will benefit from the depreciation of the tenge in Q4 2015 and also from rising oil prices.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Litigation case will not affect sale, says Kazakh energy company

MAY 30 2016 (The Conway Bulletin) — Kazmunaigas, Kazakhstan’s state- owned energy company, said that a litigation case in Romania involving one of its subsidiaries will not affect the sale of the unit to China’s CEFC. Last December, CEFC agreed to buy a 51% stake in KMG International, formerly Rompetrol. Romanian prosecutors seized KMG International’s refinery earlier in May during an investigation into its privatisation and subsequent sale to to Kazmunaigas.

ENDS

(News report from Issue No. 283, published on June 3 2016)

Azerbaijan’s energy company to make agreement with India

MAY 30 2016 (The Conway Bulletin) — India’s state-owned ONGC Videsh said it had entered into a preliminary agreement with SOCAR Trading, the Geneva-based branch of Azerbaijan’s state-owned energy company SOCAR, to jointly sell oil it produces in Azerbaijan. Since 2013, ONGC Videsh has owned a 2.7% stake in the Azeri Chirag-Guneshli offshore oil project in Azerbaijan.

ENDS

(News report from Issue No. 283, published on June 3 2016)