SEPT. 3 2013 (The Conway Bulletin) — Corruption and a poorly educated workforce are the biggest problems to doing business in Kazakhstan, according to executives interviewed in the World Economic Forum’s Global Competitive Index. The index ranked Kazakhstan at 50th position, up one place from last year, out of 148 countries.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 10 2013 (The Conway Bulletin) –Just as first oil from the giant Kashagan field in Kazakhstan’s sector of the Caspian Sea draws tantalisingly close, a partner in one of its main export routes has warned of a delay to planned capacity expansion.
In an interview with Reuters, Mikhail Barkov, vice-president at Russian pipeline monopoly Transneft, said work to expand the Caspian Pipeline Consortium (CPC) pipeline that runs from Atyrau in west Kazakhstan to the Russian Black Sea port of Novorossiik had been delayed by 6-12 months.
He didn’t give any reason for the delay.
Transneft is the largest shareholder in CPC, followed by Kazmunaigas and US oil major Chevron. There are several other smaller shareholders. The pipeline started operations in 2001 and has been an important export route for Kazakh oil, mainly from the Chevron-led Tengizchevroil project.
The plan had been to roughly double the capacity of CPC to about 1.3m barrels of oil a day by 2015, partly to cope with extra supplies from the Kashagan oil field.
News of the CPC delay is likely to frustrate Kazakh oil exporters, particularly as they were set to soon celebrate the first oil from Kashagan after years of delays and cost overruns.
On Sept. 7, Sauat Mynbayev, head of Kazmunaigas, said that Kashagan would start production within a month.
An expanded CPC has been touted as one of the primary export routes for oil from Kashagan. The expansion delay is likely to push oil from Kashagan — operated by a consortium of ENI, ExxonMobil, Total, Kazmunaigas, Shell, Inpex and now China’s CNPC — onto other export routes wholly owned by Russia.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 2 2013 (The Conway Bulletin) — In a thinly veiled reference to Azerbaijan’s weapons purchases from Israel, Iranian navy commander Habibollah Sayari told local media that some Caspian Sea countries wanted to disrupt peace in the region. Azerbaijan has been spending billions of dollars in recent years bolstering its military.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 5 2013 (The Conway Bulletin) — Maybe, just maybe, the Nabucco pipeline project is not dead yet. That was the message given out by Natik Aliyev, Azerbaijan’s oil and gas minister, on Sept. 5.
Nabucco was the ambitious project backed by Central European countries to pump gas from Azerbaijan’s sector of the Caspian Sea.
After years of planning and negotiations it lost out on the lucrative contract earlier this year to a rival bid, the Trans-Adriatic Pipeline (TAP). TAP will pump Azerbaijani gas to Europe through the Balkans and under the Adriatic Sea to Italy.
And that looked like that for Nabucco.
Except that now Mr Aliyev has opened up the possibility of building another pipeline to carry gas to Europe.
“Nabucco is not dead,” he said, according to media reports. “It depends on our resources and I think that we have enough resources to increase production.”
Azerbaijan and Europe have become increasingly dependent on each other over the past few years. Europe has been desperately trying to reduce its dependency on gas from Russia, seen as an unreliable partner. Azerbaijan has also been keen to diversify its client base away from Russia.
When the Caspian Sea gas field Shah Deniz II starts production in 2019/2020 it will transform Azerbaijan’s energy outlook. It may also need more pipelines snaking from the Caspian Sea towards Europe.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 11 2013 (The Conway Bulletin) — Serzh Sargsyan, the Armenian president, sent shock waves across the South Caucasus and Europe when he signed Armenia up for Russia’s Customs Union.
The Kremlin set up the Customs Union in 2011 to ease trade between its partners and to draw them in closer. Commentators have dubbed it a Eurasian Union to counter the European Union.
Until Armenia moved into the Customs Union, only Kazakhstan and Belarus had joined. Kyrgyzstan has said it will join and Tajikistan has also been eyeing up membership.
Few though predicted Armenia’s jump towards Russia.
Mr Sargsyan’s decision to move into the Customs Union was a snub for European diplomats.
It’s not, perhaps, that surprising though. Armenia has been casting around for friends to provide a bulwark against Azerbaijan and Turkey. Armenia is still officially at war with Azerbaijan over the disputed region of Nagorno-Karabakh. Turkey is a key Azerbaijan ally.
Russia has given financial and military support to Armenia and maintains a large army base in Armenia. Gazprom, the Russian gas monopoly, also owns 80% of Armenia’s gas distributor and has been trying to buy the outstanding 20%.
Even so, Armenia’s move into the Customs Union will be felt across the region for years.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 7 2013 (The Conway Bulletin) — The chairman of Iran’s parliament, Ali Larijani, led a high-level delegation to Turkmenistan on a mission to broaden cooperation between the two neighbours, media reported. Relations between Turkmenistan and Iran have been improving over the past few years.
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(News report from Issue No. 151, published on Sept. 11 2013)
SEPT. 5 2013 (The Conway Bulletin) — Azerbaijan may need another gas pipeline once Shah Deniz II starts production in 2019/2020, media quoted the Azerbaijani energy minister, Natik Aliyev, as saying. His statement may breathe fresh life into the Nabucco project which lost out on pumping gas to Europe earlier this year.
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(News report from Issue No. 151, published on Sept. 11 2013)
AUG. 28 2013 (The Conway Bulletin) –Kazakh football team Shakhter Karagandy narrowly missed out on becoming the first side from Kazakhstan to compete in the UEFA Champions League group stages after losing 3-0 in Glasgow, Scotland, to Celtic. Shakhter Karagandy had beaten Celtic 2-0 in the first leg of the tie a week earlier in Astana.
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(News report from Issue No. 150, published on Sept. 2 2013)
AUG. 26 2013 (The Conway Bulletin) — Irish Distillers, a subsidiary of Pernod Ricard, has lost the rights to the Jameson whiskey brand name in Uzbekistan, RFE/RL reported. A local company owns the Jameson brand name through a 2008 patent, the court ruled. Western companies have previously struggled to defend intellectual property in Uzbekistan.
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(News report from Issue No. 150, published on Sept. 2 2013)
AUG. 30 2013 (The Conway Bulletin) — Uzbekistan Airways, the state-owned airline, has placed an order for two new Dreamliner Boeings, media reported. Neither the Uzbek government nor Boeing have confirmed these reports. In August, senior Boeing executives reportedly travelled to Tashkent for meetings with Uzbek government officials.
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(News report from Issue No. 150, published on Sept. 2 2013)