Tag Archives: Kazakhstan

Border police stops Kyrgyzstan and Kazakhstan bound trucks

JULY 1 2016 (The Conway Bulletin) — The Russian border police stopped 43 goods trucks travelling from Ukraine to Central Asia at the border with Belarus. The trucks were bound for Kazakhstan and Kyrgyzstan, but were stopped because of new Eurasian Economic Union (EEU) regulation that appears designed as a retaliation forWestern imposed sanctions on Russia. The EEU is a Russia-led economic bloc that includes Kazakhstan, Kyrgyzstan, Armenia and Belarus.

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(News report from Issue No. 288, published on July 8 2016)

TCO approves $36.8b project for Tengiz oil field in Kazakhstan

JULY 5 2016 (The Conway Bulletin) — Tengizchevroil (TCO), a Chevron- led consortium, approved a $36.8b expansion project for the Tengiz oil field in west Kazakhstan. The consortium said the expansion will boost production by 45% to around 39m tonnes/year by 2022. Tengiz is Kazakhstan’s most profitable oil field.

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(News report from Issue No. 288, published on July 8 2016)

Kazakhstan’s Tengizchevroil approves $37 billion expansion plan

ALMATY, JULY 5 2016 (The Conway Bulletin) — After prevaricating for three years, Tengizchevroil (TCO), a Chevron-led consortium, approved the $36.8b expansion of the Tengiz oil field in west Kazakhstan.

Low oil prices had thrown the Tengiz expansion plans into doubt, so the decision will be a huge relief to the Kazakh government which has been looking for ways to stimulate output to beat slowing GDP growth.

The so-called Future Growth Project will boost production at TCO by 45% to 39m tonnes/year by 2022.

Government officials and company representatives lauded the deal, the largest private investment in the world’s oil industry for a decade.

“This decision made by major international companies re-affirms that the Republic of Kazakhstan is a country with favourable business climate where long-term investments can be made with confidence,” the Kazakh minister of energy Kanat Bozumbayev said in a press release.

Through its state-owned energy company Kazmunaigas, Kazakhstan owns 20% of TCO. The other shareholders are Chevron (50%), Exxon (25%) and Lukoil’s subsidiary LukArco (5%).

The development of the Tengiz oil field near Atyrau has been one of the West’s success stories in the former Soviet Union. It is Kazakhstan’s largest oil producer, pumping out a third of its total output, and exports via the CPC pipeline that sweeps through Russia, north of the Caspian Sea to Novorossiysk on the Black Sea.

This compares to the Kashagan oil project in the Caspian Sea which is years behind schedule and billions of dollars over budget.

Analysts said that TCO had decided that oil prices were steadily moving back up and that low steel prices and cheap labour made the timing right for expansion.

The consortium said the expansion will generate as many as 20,000 jobs during the peak construction phase.

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(News report from Issue No. 288, published on July 8 2016)

SFO to look into Kazakh ENRC

JULY 3 2016 (The Conway Bulletin) — The British government gave the Serious Frauds Office extra funding to complete its ongoing corruption investigation into ENRC, a Kazakh miner that quit the London Stock Exchange in 2013. The company is accused of having paid bribes to win contracts in Kazakhstan and Africa. Three prominent Kazakhstan-based businessmen, Alexander Mashkevich, Alijan Ibragimov and Patokh Chodiev, founded ENRC, now called Eurasian Resources Group.

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(News report from Issue No. 288, published on July 8 2016)

Stock market: Central Asia Metals

JULY 4 2016 (The Conway Bulletin) — Central Asia Metals, a Kazakhstan-focused copper producer, jumped 5% on Monday after it announced that its Q2 production had increased by 20%, boosting investor confidence. It closed at 156p/share on Thursday.

The company can now boast a 27% growth in production and a 24% increase in sales for H1 2016, compared to the same period last year. Central Asia Metals is expanding its Kounrad project, a copper recovery plant, which should be expanded in H2 2016.

The past six months or so have been a rollercoaster for Central Asia Metals’ share price. It plunged to an 18-month low in January before rebounding back to above 160p/share in March. After a brief period of stability, though, the stock suffered the downward pressure of declining copper prices and spiraled down to around 145p/share.

Analysts said the nature of Central Asia Metals’ production makes it immune from copper price volatility, but, as shown in the graph, both the stock and the commodity have gained 10% since the beginning of the year.

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(News report from Issue No. 288, published on July 8 2016)

Kazakhstan is ready to supply gas to China, president says

JULY 4 2016 (The Conway Bulletin) – President Nursultan Nazarbayev said Kazakhstan is ready to supply gas to China, a move that would further improve the two countries’ energy ties. Mr Nazarbayev met with Wang Yilin, chairman of China’s state-owned energy company CNPC, in Astana. Mr Nazarbayev hailed CNPC’s role in boosting Kazakhstan’s energy sector with its multi-billion dollar investments over the past two decades. Kazakhstan currently hosts a gas pipeline that pumps Turkmen gas to China.

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(News report from Issue No. 288, published on July 8 2016)

Kazakh city government refuses land protest

JULY 1 2016 (The Conway Bulletin) — The city government of Shymkent, south Kazakhstan, said it rejected an application filed by civic activists to hold a rally against the land reform on July 6. The local government said that the activists had failed to apply on time. Although it has formally been scrapped from parliamentary debate, the proposed land reform is still a contentious issue in Kazakhstan.

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(News report from Issue No. 288, published on July 8 2016)

China to invest into Kazakh Glencore

JULY 6 2016 (The Conway Bulletin) – State-owned China National Gold Group and Silk Road Fund will partner to invest $2b to buy the Vasilkovskoye mine in Kazakhstan, owned by Glencore. China’s Shandong Gold Mining and Zijin Mining Group have also expressed interest in the mine. Glencore owns 70% of Kazzinc, the company that operates Vasilkovskoye, which is located 300km north-west of Astana.

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(News report from Issue No. 288, published on July 8 2016)

Kazakhtelecom improves corporate governance ahead of a potential IPO

ALMATY, JULY 4 2016 (The Conway Bulletin) — Aleksander Klebanov, one of Kazakhstan’s richest men, bought a 24.47% stake in Kazakhtelecom, the state-owned telecoms company, in a move to improve corporate governance ahead of a planned IPO in London.

Mr Klebanov’s Sobrio Ltd, a London-registered shelf company, bought shares from two companies officially owned by Aigul Nuriyeva, the 8th richest Kazakh according to Forbes. She was widely perceived as holding these companies on behalf of Mr Klebanov.

Wary of past corporate governance flops, Kazakhtelecom said the transfer of shares would improve transparency ahead of an IPO.

“The deal was conducted for Kazakhtelecom ownership structure optimisation and transparency purposes in preparation for a possible IPO,” the company said in a press release.

For two years, Kazakhtelecom has mulled over an IPO in London.

Samruk-Kazyna, Kazakhstan’s sovereign wealth fund, owns 52% of Kazakhtelecom. Earlier this year, Kazakhtelecom’s subsidiaryAltel merged with Tele2, a Swedish telecoms company, in an effort to boost its mobile profile.

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(News report from Issue No. 288, published on July 8 2016)

Kazakh capital grows in population

JULY 4 2016 (The Conway Bulletin) — Kazakh President Nursultan Nazarbayev said triumphantly that Astana had grown to 1m residents. The announcement came just days before the celebrations of Astana Day, a holiday in Kazakhstan that coincides withMr Nazarbayev’s birthday. The figure appears designed to impress upon people the success of the Astana project. By most estimations, the population of Astana is around 800,000.

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(News report from Issue No. 288, published on July 8 2016)