Bishkek promises Kyrgyzgaz sale to Gazprom within three weeks

By bne IntelliNews March 13, 2013

bne -

The Kyrgyz government hopes to finally seal an agreement on the sale of national gas distribution company Kyrgyzgaz to Russia's Gazprom within the next three weeks or so, the prime minister said on March 12.

The sale of the Kyrgyz company is expected to be agreed by the end of March, Prime Minister Zhantoro Satybaldiyev told Reuters. "The process of negotiations is under way, and I hope that during March we will finish it ... Only technical issues remain to be resolved," the PM said in an interview.

Kyrgyz and Russian officials are due to meet in Kyrgyzstan on March 18-19, and may decide then on the sale of the heavily indebted company, which has been under discussion for more than a year. Bishkek is desperate to strike a deal in a bid to start solving the country's chronic gas shortages, and has regularly claimed a deal is imminent in recent months.

In 2012, Gazprom offered to buy a 75% stake in Kyrgyzgas for $1, under a deal that would also see the Russian company invest up to $500m to rehabilitate Kyrgyzgaz' dilapidated infrastructure. The purchaser would also pay off the company's debts, with the Kyrgyz national gas company in the hole for around $40m to Kazakhstan and Uzbekistan for imports.

Those unpaid bills have contributed to the shortages, which have caused no little discomfort for the population and hampered industry. In April, even the eternal flame on Bishkek's Victory Square was temporarily extinguished after the city failed to pay its gas bill.

Most of north Kyrgyzstan was cut off during a cold snap across Central Asia in December, and Kyrgyzgaz's arrears to the Kazakh and Uzbek gas transportation companies did little to aid its hope of receiving uninterrupted supplies. Such events have seen the government facing increasing political pressure. Satybaldiyev said in February, when he last claimed a deal with Gazprom was imminent, that the Russian state giant has promised uninterrupted supplies.

President Almazbek Atamabaev said earlier this year that in order to get Kazakhstan to reopen the taps, Astana was promised that the Russian company will clear the outstanding debt. "Our Kazakhstan partners have been notified that these debts will be paid off by Gazprom ... Both the president and prime minister of Kazakhstan know it," Atamabaev said. However, in February KazTransGas again threatened to suspend gas exports.

Related Articles

Drum rolls in the great disappearing act of Russia's banks

Jason Corcoran in Moscow - Russian banks are disappearing at the fastest rate ever as the country's deepening recession makes it easier for the central bank to expose money laundering, dodgy lending ... more

Kremlin: No evidence in Olympic doping allegations against Russia

bne IntelliNews - The Kremlin supported by national sports authorities has brushed aside "groundless" allegations of a mass doping scam involving Russian athletes after the World Anti-Doping Agency ... more

PROFILE: Day of reckoning comes for eccentric owner of Russian bank Uralsib

Jason Corcoran in Moscow - Revelations and mysticism may have been the stock-in-trade of Nikolai Tsvetkov’s management style, but ultimately they didn’t help him to hold on to his ... more

Register here to continue reading this article and 2 more for free or purchase 12 months full website access including the bne Magazine for just $119/year.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

If you have any questions please contact us at sales@intellinews.com

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at sales@intellinews.com

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

Already a subscriber or registered - click here to recover access.

If you a IntelliNews Pro user - click here to login.

Thank you. Please complete your registration by confirming your email address.
A confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.

Dismiss