Kirgizia: Gas Is Sold

On October 8th the Prime Minister of Kirgizia Zhantoro Satybaldiyev reported that the issue of Kyrgyzgaz OJS sale is resolved, it’s left only to pass ratification of the agreement in the Parliaments of Kirgizia and Russia -  the Supreme Council (SC) and State Duma (SD).


Let’s remind that at the moment the process of transfer of Kirgiz Kyrgyzgaz OJS company to Russian Gazprom OJS is in progress.


The transfer should be performed by Gazprom’s purchase of the affiliate of Kyrgyzgaz, to which Kyrgyzgaz plans to grant all its property, titles, liabilities and interests. From the moment of transfer of the company to Gazprom all debt liabilities of Kyrgyzgaz shall also transfer to the Russian party. According to the agreement with the government of Kirgizia, Gazprom shall supply gas to Kirgizia, transport it, store in underground storages, distribution and sale. Except for that, Gazprom shall undertake construction, reconstruction and operation of the infrastructure facilities of the gas complex (gas-transporting means, gas distribution, underground storage and delivery of gas to consumers). From its side Kirgiz party guarantee fixed gas prices, regular revision of tariffs, complete and due payment of gas by budgetary and other consumers.


The agreement between the governments of two countries, signed on July 26th in Moscow, was concluded for the term of 25 years. Its termination provides transfer into the ownership of the Kirgiz party of the founded company with its gas transporting system, including main gas pipelines.


On October 10th the government of Kirgizia addressed the SC with the request to ratify the agreement on transfer of Kyrgyzgaz to Gazprom, because, as abovementioned, such bilateral agreements are subjected to mandatory ratification in the parliaments of the both countries.


Meanwhile, the press-service of Kyrgyzgaz has reported today, that Kirgizia “works out” the issue of natural gas supply with Kazakhstan till the end of 2013 (the term of the previous agreement expired in September ). Also the agreement with Uzbekistan on natural gas supply is valid till the end of the year (100 mln cub.m. for 290 USD per each).


Zh. Satybaldiyev, commenting on these negotiations, explained that despite the fact that the issue of the ratification of the agreement with Gazprom is almost completes, Kirgizia agrees about gas supplies with Uzbekistan and Kazakhstan “just in case”, to have some backup. Being aware of the capabilities of Kirgiz parliament, when the case is about foreign investors and fulfillment of undertaken agreements, the head of Kirgiz government should realize that backup is really preferable.


Translated from REX