Russian Gazprom acquires gas infrastructure in Kyrgyzstan
By Aynur Jafarova
Russia and Kyrgyzstan signed an intergovernmental agreement on cooperation in the field of transportation, distribution and sale of natural gas in the territory of Kyrgyzstan.
Russian Energy Minister Alexander Novak and Kyrgyz Energy and Industry Minister Osmonbek Artykbayev undersigned the deal.
Under the agreement, a 100-percent subsidiary company Kyrgyzgas will be established in Kyrgyzstan, which will take under ownership all gas pipelines, gas distributing stations, underground gas storages, ground facilities and other infrastructures, as well as rights and interests envisaged in the agreement.
Russian gas giant Gazprom acquires 100-percent interest in the share capital of the company for $1 on the basis of the sales and purchase agreement between Kyrgyzgas and Gazprom.
Kyrgyzgas will supply gas to the territory of Kyrgyzstan, underground gas storage, construction, renovation and exploitation of the gas transmission and distribution systems, underground gas storage facilities and other infrastructure of the gas industry of the country.
Following acquisition of Kyrgyzgas, Gazprom and its subsidiaries will have an exclusive right to import natural gas to the country and will be protected against expropriation and nationalization in Kyrgyzstan.
Meanwhile, Gazprom is committed to pay off Kyrgyzgas's $40 million debt and guarantees to invest over 20 billion rubles ($612.8 million) in modernization and reconstruction of Kyrgyzgas's gas infrastructure in five years.
Recall, on July 9, 2013, Russian Prime Minister Dmitri Medvedev
signed on order on the 25-year long agreement on cooperation in the
transport, distribution and sale of natural gas in the territory of
Kyrgyzstan.
In December 2012, member of Kyrgyzstan's parliament Muradil
Mademinov offered Gazprom to buy Kyrgyzgas "for $1".
"Let them buy KyrgyzGas, even for just $1, but only if they solve all the problems, renew the gas pipelines and ensure uninterrupted gas supplies to people," he said.
Kyrgyzstan Prime Minister Zhantoro Satybaldiyev also announced that the country's government was willing to sell KyrgyzGas for $1 to solve gas supply problems in the country.
Gazprom is the largest producer of natural gas in the world and the major Russian company. Its major business lines are geological exploration, production, transportation, storage, processing and marketing of hydrocarbons, as well as generation and marketing of heat and electric power. The Russian government has a controlling stake in the company.