Page 41 - GEORptFeb19

River located in the Racha-Lechkhumi and Kvemo Svaneti regions. Georgia, already having robust power generation capacities (some 80% of its electricity is generated in hydropower plants ) and being an established regional exporter, plans to build a large number of dams because its generation capacities largely matching consumption tend to fall short of growing consumption . Turkey is among the largest investors in Georgia and a significant export market for Georgia’s electricity. Environmental NGO Bankwatch, however, has questioned the plans for more hydropower plants in the absence of a broader energy sector strategy. Furthermore, the environmental impact of the planned dams is major, Bankwatch has warned .
9.1.9 Utilities sector news
Georgia is to privatise its postal services run by Georgian Post, economy minister Giorgi Kobulia said in a Bloomberg interview, after which he explained the policy to local media .
The country’s railway transport company will be unbundled, its railway transport market will be opened up to private operators and the electricity system privatisation might resume, he also reportedly said.
The privatisation option was under consideration for the railway company Georgian Railway, but only after a company reorganisation including the unbundling of the railway infrastructure and transport functions, Kobulia added. As part of the railway transport system restructuring, the government wants to encourage more involvement of private railway operators, while the infrastructure management company would operate separately.
Georgia has to restructure its railway transport and electricity systems under the EU-Georgia Association Agreement. It must also implement EU directives on railway transport, which require the infrastructure segment to be segregated by 2022.
Similar restructuring plans are envisaged for the Georgian electricity distribution. Under the Association Agreement and the Energy Community Treaty, Georgia has to implement the Third Energy Package into its national legal framework.
"We need to increase the efficiency of these companies in order to privatise them," said Kobulia in relation to Georgian Railway and State Electrosystem. According to Kobulia, the plan is to eventually privatise State Electrosystem. Its selloff was suspended in 2011 in the face of "challenges" on the market.
9.2 Major corporate news 9.2.1 Oil & gas corporate news
Azerbaijan has moved further into securing more value from its huge gas resources with the launch of the country’s first urea plant by the State Oil Company of the Azerbaijan Republic (SOCAR).
Production at the €800mn installation in Sumqayit Industrial Zone outside Baku began on January 16, according to officials. Around 70% of the plant’s urea (aka carbamide) production is likely to be exported to Turkey, Georgia and other Black Sea markets and Mediterranean markets. The remainder is to be sold on the domestic market, saving Azerbaijan around $90mn on urea imports. The production targets are 1,200 tonnes per day of ammonia and 2,000 tonnes per day of granular urea. Around 435mn cubic metres of natural gas as raw material is to be consumed.
41 GEORGIA Country Report February 2019 www.intellinews.com