Page 10 - FSUOGM Week 33 2019

FSUOGM PIPELINES & TRANSPORT FSUOGM
Chinese-Kazakh pipe JV refinances debts
KAZAKHSTAN
The debts were
taken out to fund the pipeline’s construction.
A Chinese-Kazakh pipeline joint venture has re nanced its debts by securing a $720mn syn- dicate loan.
Beineu-Shymkent Gas Pipeline, a 50:50 partnership between Kazakh gas grid operator Kaztransgas (KTG) and China’s Trans-Asia Gas Pipeline (TAGP), signed the loan agreement with a group of international banks, KTG said on August 6. Japan’s MUFG Bank and Bank of China helped organise the loan.
Beineu-Shymkent Gas Pipeline operates the Beineu-Bozoi-Shymkent (BBS) pipeline that stretches for 1,475km from west to south Kazakhstan. e pipeline is used to transport gas from western elds to China as well as domestic demand centres.
Beineu-Shymkent Gas Pipeline will use the syndicate loan to cover repayments for other loans provided by the China Development Bank (CDB) and the Bank of China drawn in 2012 to fund the pipeline’s construction, KTG said. According to the Kazakh operator, refinanc- ing the debts will reduce interest payments by $10mn per year.
Under BBS’ rst stage completed in 2013, the pipeline was built to supply up to 6bn cubic metres of gas per year to domestic consum- ers. Its capacity was later expanded to 10 bcm, and its length extended by 306km, enabling Kazakhstan to start piping gas to China in 2017.
KTG entered a deal in October that year to deliver 5 bcm per year of gas to the Chinese market, but expanded this to 10 bcm in late 2018. Supplies are rst pumped into the Central Asia-China system, which runs from eastern Turkmenistan to China’s north-west Xianjing Province.
With the launch of a new compressor sta- tion this February, BBS’ capacity has now been enlarged to 15 bcm.
Kazakhstan’s focus is now on building another pipeline connecting BBS with its capital Nur-Sultan in the north, as part of a nationwide gasi cation programme. Construction of the 2.6 bcm per year Saryarka pipeline was three-quar- ters complete as of August 19, according to Kazakh authorities. ™
PERFORMANCE
Russian pipemaker TMK posts 77% profit jump in 2Q19
RUSSIA
Ebitda saw the strongest growth in North America.
RUSSIAN steel large-diameter pipe (LDP) pro- ducer TMK reported a net IFRS pro t jump of 77% quarter on quarter to $67mn, beating the analysts’ estimates by 13%. Company’s revenues were up by 4% q/q to $1.3bn, while Ebitda gained 11% q/q to $166mn.
By divisions, TMK’s Ebitda in Russia was up by 21% q/q to $166mn, down by 33% q/q to $20mn in North America, and at q/q at $8mn within the EU. Previous reports claimed that TMK could cash in $1.2bn with the sale of 100% of its US subsidiary IPSCO Tubulars.
TMK has given “no word yet on the IPSCO deal, but operations are already reported as “discontinued”, implying the deal could be very close,” BCS Global Markets commented on August 19, reminding that the deal would be a key catalyst for the name.
e potential sale of IPSCO was welcomed by the analysts, as TMK had planned to raise $465mn-535mn from the deal, but raised dou- ble the amount of $939mn (minus the $270mn
working capital).
Going forward, the company expects
EBITDA for the Russian division to rise in 2019 on the back of strong demand, while for the North American and EU segments EBITDA is anticipated to remain under pressure owing to weakened consumption from the US oil and gas industry and slowed activity in Europe.™
P10
w w w . N E W S B A S E . c o m
Week 33 21•August•2019