Page 12 - FSUOGM Week 03 2022
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FSUOGM NEWS IN BRIEF FSUOGM
January 2022. Party’s reservations over the Nord Stream situation in Ukraine. The Kremlin has made it
Gas production from the Shah Deniz 2 pipeline, the new Chancellor Olaf Scholz clear that since Merkel’s departure from office
field began in December 2006. Exports of has so far continued his predecessor Angel it prefers bilateral talks with the US rather
Azerbaijani gas from the Shah Deniz field in Merkel’s policy of supporting it. Piping gas than multilateral talks with bodies like Nato
2020 amounted to 12.256 bcm and exceeded cannot start until it has been certified by the or the EU..
the figure for 2019 by 17.8%.. German regulators.
On the same day following a meeting
between Scholz and Nato Secretary-General VTB sees potential for credit
Germany warns Nord Stream Jens Stoltenberg, the German premier said it standing of Uzbekneftegaz to
was “clear that there will be a high price to pay
2 will be blocked if Russia and that everything will have to be discussed strengthen
should there be a military intervention in
attacks Ukraine Ukraine”. Russian investment bank VTB Capital (VTB)
Approval of the pipeline was due before
Baerbock went on her first official visits to the end of last year, but the German regulator has published an overview of Uzbekistan’s
Ukraine and Russia, which took place against delayed the decision as tensions rose following state-owned oil producer Uzbekneftegaz
the backdrop of the tense military situation the reports of the Russian military build-up in (UNG), including a look at its debut eurobond
close to the Ukrainian border and following November. and development prospects for the coming
a week of meetings between Russia and the The fate of the project could ultimately years.
Nato-Russia Council as well as the OSCE. be out of Germany’s hands, as it is subject to UNG placed its eurobond (tenor seven
“I will listen very closely to my the approval of European Union regulators. years, size $700mn and coupon at 4.75%) in
interlocutors, both in Moscow and Kyiv. But The EU’s foreign policy chief, Josep Borrell, November 2021. The issuer’s credit standing
I will also clearly convey the position that we said last week that approval was tied to any is backed up by its dominant positions in the
unanimously share within the EU, the G7 potential conflict with Russia over Ukraine. Uzbek energy sector and proven track record
and the transatlantic alliance,” Baerbock said Baerbock has been attempting to establish of state support, while the key credit risks in
in a statement issued on the German foreign her credentials and made a symbolic stop-off VTB’s view comes from declining production
ministry website. in Ukraine to meet with Ukrainian President and a revenue-debt FX mismatch.
“Germany is willing to engage in serious Volodymyr Zelenskiy on the day before she “We see potential for UNG’s credit
dialogue on what we can do to increase arrived in Moscow, where she reaffirmed standing to strengthen in the coming years on
security for everyone in Europe. Our guide Berlin’s commitment to upholding Ukraine’s the back of Uzbekistan’s natural gas market
is and remains the fundamental principles of territorial integrity in the face of Russian being liberalised and should the company
the Helsinki Final Act, which have served as aggression. deliver on its strategic targets,” VTB noted.
guarantors of peace and security in Europe Baerbock called for a peaceful resolution UNG is an integrated Uzbek producer
over the last 50 years. They include territorial to the current stand-off during her visit to of natural gas, liquid hydrocarbons and
integrity and the right of states to choose their Kyiv on January 17 as relations with Russia petrochemicals, controlling around 50% of
own alliances,” Baerbock said. dominated the agenda. hydrocarbon deposits in the country. It is
The pipeline was completed last September “Diplomacy is the only viable way,” 99.94% owned by the Ministry of Finance of
and links the huge Russian Yamal gas fields Baerbock said during a press conference Uzbekistan and is rated on par with the Uzbek
in the Arctic directly with Germany through following a meeting with her Ukrainian sovereign by S&P and Fitch (at BB-/Stable)..
a pipe that runs under the Baltic Sea. Critics counterparty Dmytro Kuleba. She added that
have claimed the purpose of the pipeline “any further aggression would come at great
is to cut Ukraine out of the loop and deny cost to Russia.” SOCAR and Axens signs
the government in Kyiv some $2bn a year Later in Moscow Baerbock announced that
it earns in transit fees. The US in particular she had discussed restarting the Normandy contract
has claimed the new pipeline will undermine Four talks between France, Germany, Russia
European energy security and hand the and Ukraine that were designed to bring a The international group of companies “Axens”
Kremlin a new geopolitical tool. resolution to the undeclared war in Ukraine’s has become the licensor and designer of
Baerbock was recently appointed Foreign eastern region of Donbas. the catalytic cracking unit at the Heydar
Minister in the new coalition government, Following the week of meetings last year, Aliyev Baku Oil Refinery (BOR) of SOCAR
and as the head of the German Green Party the Kremlin suggested that the talks had failed (State Oil Company of Azerbaijan): “The
she has been critical of the gas pipeline. blaming Washington for refusing to consider signing of a contract between BOR and
A foreign policy political novice, Baerbock Russia’s key demand: open talks on excluding Axens for licensing and designing a catalytic
has started her new job during one of the Ukraine from “ever, ever” joining Nato, cracking unit as part of the project for the
most tense periods in East-West relations according to Russian Deputy Foreign Minister modernisation and reconstruction of the
since the fall of the Soviet Union after Russia Sergei Ryabkov. Baku Oil Refinery was held on Monday (17
built up its forces on Ukraine’s border ahead However, Lavrov has suggested that talks January),” SOCAR said in a statement.
of issuing an eight-point list of demands, will continue with a proposed meeting with “We are pleased to expand co-operation
including “legal guarantees” that Nato’s his US counterpart US Secretary of State with SOCAR. In this context, choosing us as a
eastward expansion halt. Antony Blinken on January 22. licensor for the construction of a new facility
During her press conference after talks The Kremlin has not yet pronounced the is great confidence in our company. We will
with Lavorv, a foreign policy veteran, talks entirely dead, as it is still waiting on a do our best to complete the design work in
Baerbock said it was difficult not to assess written response from the White House on its a short time and at a high level. We believe
Russia’s military build-up near Ukraine’s eight-point demands in writing that are due that after the construction of the new catalytic
borders as “a threat.” any day. cracking unit, the operation of the plant will
However, Baerbock also tried to strike a During his talks with Baerbock, Lavrov become more sustainable and efficient,” said
consolatory tone, saying that Berlin remains said that the Kremlin remains open to Jean Sentenac, CEO of Axens.
open to negotiation and despite the Green including Washington in the talks over the According to the State Oil Company
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