Page 16 - FSUOGM Week 10 2021

FSUOGM NEWS IN BRIEF FSUOGM

March 5 (or more likely, next week) we the government’s press service. of its subsidiaries KazTransGas JSC (KTG;
will see the Economy Ministry’s resolution The decision is aimed at stabilising BBB-/Stable) and JSC KazTransOil (KTO;
on this issue, so we will be able to more prices for oil and oil products in the Kyrgyz BBB-/Stable).”
adequately assess risks for Naftogaz domestic market, the government's press The impact of the potential KTG disposal
fundamentals and for Ukraine’s co- service said. on KazMunayGas's SCP will depend on the
operation with the IMF,” an analyst at the The export ban mainly applies to oil way KTG is structured and the nature of the
Kyiv-based Concorde Capital brokerage said products shipped by road and rail, but post-disposal financial profile. The business
in a research note. excludes fuel oil. The ban will stay in force profile would be slightly less diversified
until a sufficient level of domestic market without KTG but remain in line with the 'bb-
saturation is achieved. ' SCP, the ratings agency said.
US deputy state secretary bought in Kyrgyzstan by individuals and
The ban does not apply to oil products
nominee vows to stop Nord transported outside of the country for Kazakhstan to launch
personal use. In this instance, the fuel must
Stream 2 be located in the fuel tank of a car or in a construction of $860mn
separate container with a volume of no more
Wendy Sherman, US President Joe Biden’s than 20 litres. gas processing plant at
nominee for the position of deputy
secretary of state, said on March 3 during Kashagan this year
the Senate Foreign Relations Committee’s Turkey’s natural gas
hearing that she would do everything Kazakhstan plans to begin construction of a
possible to stop Russia’s Nord Stream-2 imports from Azerbaijan up $860mn gas processing plant with a capacity of
natural gas pipeline. 1,150bn cubic metres of raw gas at Kashagan oil
“If confirmed, will you move 20% in 2020 field this year, Kazinform news agency reported,
immediately to ensure that the Biden citing Kazakh Energy Minister Nurlan Nogayev
administration meets its mandatory Turkey’s natural gas imports rose 6% y/y to speaking at a meeting of the energy ministry.
obligation imposed by Congress to name 48bn cubic metres in 2020 from 45 bcm in The project is to lead to an output boost
and sanction all of the entities that are 2019 but remained below the 50 bcm seen in of an additional 800mn cubic metres of
engaged in pipe-laying, pipe-laying 2018, according to data from Turkish energy commercial gas along with a rise in oil
activities, certification, or insurance related watchdog EPDK. production to 10mn tonnes, up from 8mn
to Nord Stream-2?” Senator Ted Cruz asked Russia retained its 34% share in Turkey’s tonnes.
Sherman. imports while Azerbaijan recorded the Nevertheless, it is unclear whether the
“Even if confirmed, I will not have biggest expansion in market share, moving plans may come to fruition. Italy's Eni said
the authority to make those decisions up to 24%. on February 24 that it saw no scope for
unilaterally, but I can say to you that I will new large upstream investments such as
do everything I possibly can to ensure that Kashagan. Eni’s upstream director Guido
Nord Stream-2 does not go forward,” she Fitch says diversification Brusco noted that Eni’s revised aspirations
said. paved the way for a "new model" of relations
“I know that the administration … will and deleveraging support between firms such as Eni and national
move forward on everything that they can oil companies. Resource-rich countries
do legally to stop the pipeline.” KazMunayGas’s standalone would need to work harder to prove their
The Nord Stream-2 project envisages investment attractiveness, he said.
construction of two lines of a natural gas profile
pipeline with an annual capacity of up to
55 billion cubic meters, running from the Fitch Ratings said on March 5 that Kazakh Elixir Energy start a field
Russian shore to Germany under the Baltic state-run oil and gas company KazMunayGas'
Sea. Russian gas giant Gazprom builds the diversified business profile along with program for its Mongolian
pipeline together with Germany’s Uniper forecast deleveraging support the firm’s 'bb-'
and Wintershall Dea, Royal Dutch Shell, Standalone Credit Profile (SCP). It came to methane production
Austria’s OMV, and France’s Engie. the conclusion despite a potential spin-off of
KazTransGas (KTG). Elixir Energy (EXR) has begun the 2021 field
KazMunayGas' ratings are one notch program at its Nomgon coal bed methane
below that of the Kazakh government due to production sharing contract in Mongolia,
CENTRAL ASIA & SOUTH Fitch’s view of the linkage with the state in reports the Market Herald on March 8.
line with its “Government-Related Entities The field team has commenced with
CAUCASUS Rating Criteria.” Fitch does not expect a spudding the Yangir-2 core hole to follow up
potential IPO to have a material impact on on an adjacent hole that encountered visibly
Kyrgyzstan introduces the rating, since it expects the government to bubbling coals.
remain the controlling shareholder.
The project, which is nearly equivalent to
temporary ban on export of pressure as a fall in oil prices caused funds the size of Belgium, is located in the South
“KazMunayGas's SCP has come under
Gobi region on the Mongolian Chinese
oil and oil products from operations (FFO) gross leverage to border.
The field team believes given all goes to
spike to 6.3x in 2020,” Fitch noted. “However,
Kyrgyzstan on March 2 introduced a we look at the credit profile on a through- plan, the program will continue for the rest
temporary ban on the export of oil and oil the-cycle basis and expect FFO gross of the year.
products with the exception of exports to leverage to stabilise at 4.4x in 2021-2023. The
territories of the Eurasian Economic Union company's profile is supported by the less
(EEU), Xinhua news agency reported, citing cyclical business profiles and lower leverage

P16 www. NEWSBASE .com Week 10 10•March•2021