Page 15 - FSUOGM Week 29 2021

FSUOGM NEWS IN BRIEF FSUOGM

of gas transit through Ukraine for August, Europe in a Blazing Saddles-style move and services in Kazakhstan, the firms
same as in July. whereby he holds a gun to his own head,” announced on July 12.
"Gazprom appears ready to maintain the Birman-Trickett said. KCA Deutag will hold a 51% interest in
status quo with its shipments, which likely It was aimed at the Kremlin, which is the joint venture, offering drilling services
means Europe will enter its heating season highly cognisant that any interruption of in Kazakhstan with foreign-operated
with inadequately filled storage and high gas goods from Europe would worsen Russia's oilfield projects Tengiz, Karachaganak
prices," BCS Global Markets commented own domestic inflation problem and, to a and Kashagan standing as the main target
on July 20, while maintaining a Buy call on lesser extent, Beijing, which is concerned customers. The venture will be responsible
company's shares. about the protean politics of the Belt and for engineering, procurement and leasing of
Road Initiative (BRI). drilling rigs, along with their maintenance,
The Eurasian Economic Commission operation, upgrades and modifications.
Lukashenko does gas deal, has been obligated to examine the legal exposure in Kazakhstan and currently does
KCA Deutag has had only limited
and market foundations for sanctions on
asks Putin for more money German transit. not operate any drilling rigs in the country.
The Kazstroyservice has long operated a
at St Petersburg meeting joint venture with Aberdeen-headquartered
Wood Group (Wood KSS) and has mainly
Some more details of the agreements CENTRAL ASIA & SOUTH been working at the Chevron-led Tengiz oil
struck by Belarusian President Alexander and gas project.
Lukashenko with Russian President CAUCASUS
Vladimir Putin during his visit to St
Petersburg this week have emerged. Kazakhstan fulfils its oil Kazakhstan to decrease
Amongst the deals agreed, Gazprom will
not index 2022 prices and has promised to output quota under OPEC+ LPG exports in 2022
keep natural gas prices at 2021 levels (an
already heavily discounted $128.50 per agreement for June Kazakhstan will export less liquefied
cubic metre). petroleum gas (LPG) in 2022 to free up
Agreements were also made to keep Kazakhstan has fulfilled its oil output quota supply for its expanding petrochemical
looking at fixes for the losses Belarus will under the OPEC+ agreement, producing industry, Reuters reported, citing a national
incur from Russia’s oil sector tax manoeuvre 1.465mn barrels per day in June against plan for developing the petrochemical
– a change in the way Russia taxes oil the planned 1.469mn barrels, the Kazakh sector and the energy ministry.
exports that will remove subsidies Belarus Energy Ministry said. Kazakhstan is attempting to diversify its
used to get – and talked about more loans OPEC+, consisting of OPEC members main commodities offerings by boosting
the Belarusian state desperately needs. and other major oil producers such as output and exports of value-added products
“Putin and Lukashenko have now Kazakhstan and Russia, agreed to cut oil in the hydrocarbon sector. The country
met six times since February 2020, an output in April 2020 by 9.7mn barrels per will find itself in need of additional
obvious symbol of the extent to which the day. The cut was later gradually relaxed and volumes of LPG after commissioning
mismanagement of the Belarusian economy, currently amounts to 5.8mn barrels per day. Kazakhstan Petrochemical Industries' (KPI)
its dependence on transfers from Russia, “According to preliminary data, the polypropylene-producing plant in early
and now sanctions pressure from the volume of oil and condensate production 2022. Chevron-led Tengizchevroil (TCO)
West have made the fate of the regime in in Kazakhstan in June amounted to is set to supply the plant with propane,
Minsk a problem (and constant headache) seven million tonnes. Daily production an LPG product, purchased from Turkey,
for Moscow,” independent analyst Nick in Kazakhstan, according to preliminary Eastern Europe and Asia. TCO produced
Birman-Trickett said in a note. official data, amounted to 1.465 million 1.482mn tonnes of LPG in 2020 and
With the population withdrawing barrels per day in June,” the ministry noted. exported 1.351mn tonnes, according to
dollars from the banking system and the In March 2021, Kazakhstan and Russia trading data from Refinitiv.
government running an estimated 30% of were allowed to boost oil output by 20,000 "The volumes of liquefied petroleum gas
GDP budget deficit, the Lukashenko regime barrels per day and 130,000 barrels per day, exports will decline in 2022 in line with the
is running very short of money. respectively. propane volumes which TCO supplies to
In a desperate measure, Lukashenko the petrochemical complex," Reuters quoted
authorised the confiscation of currency and the Kazakh Energy Ministry as saying in
the imposition of select capital controls Germany’s KCA Deutag emailed comments.
back in late April including restricting
purchases of foreign currency, and that enters JV with Kazakh firm Kazakhstan's LPG requirements are
order took effect just before he arrived in likely to increase rapidly next year to
St Petersburg to meet Putin. Annualised to increase Kazakhstan 717,400 tonnes from the projection of
inflation just hit 9.9%, outpacing price 102,400 tonnes for this year. At the same
increases seen in Russia. exposure time, Kazakhstan’s total LPG production is
“The meeting also came about because seen as broadly stable at 3-3.2mn tonnes.
of the unhinged nature of Lukashenko’s Kazakh building contractor Kazstroyservice
improvisatory appeals for help – threatening has entered into a joint venture with
to deny transit to German goods headed to German drilling company KCA Deutag
Russia (or China) wasn’t about threatening in order for both firms to boost exposure

Week 29 21•July•2021 www. NEWSBASE .com P15