John BON JOVI (Jr.)
ALMATY, June 24
(Special for THE GLOBE)
We hope the reader forgive us, but instead of discussing the wild ride of gasoline prices, we want to say a few words about a problem of the Kazakhstan oil industry that seems to have become secondary: the problem of oil pipelines.
The last months have been marked with growing attention to the pipeline theme. The Prime Minister established a working group consisting of the President of the NOC �Kazakhoil� Nurlan Kapparov, the President of �Kaztransoil� Timur Kulibaev, the first Deputy of the Ministry of Foreign Affairs Yerlan Idrisov, the Deputy Minister of Energy, Industry and Trade Yerbolat Dosaev and some other professionals. The main aim of this action is to guarantee the progress of the construction of new oil pipelines in Kazakhstan. It is obvious that this decision was not taken lightly. The agreement for the construction of the Karachaganak-Atyrau pipeline signed with a number of foreign companies working at Karachaganak (�British Gas�, �Agip�, �Texaco�, �Lukoil�) confirmed that this serious work was being done long ago.
The official speeches of Kazakhstan�s leaders again touch upon the theme of the pipeline to Iran - obviously the most economically profitable, but politically delicate rout. European and Asian oil companies tend to positively evaluate this variant. The French company �Total� which has already conducted the technical analysis of this route and has very strong positions in Iran, is, probably, the obvious leader. However American companies are against this direction due to well-known political reasons (though we dare suppose that American companies are mainly forced to do this).
Nevertheless, if the Kazakhstan government undertakes the political responsibility of working out a political deal with Iran and Turkmenistan, it could be possible to attract several companies to this idea (the members of OKIOC may form the core). The door should be kept open also for American companies (in case relations between the USA and Iran change). At the end the project may become interesting and well balance and even more viable than the notorious Chinese route. By the way, it seems to us that the Chinese National Oil Company has also begun to understand that the way from Kazakhstan to the industrial centres of Eastern China is shorter via the Persian Gulf. In anticipation of the President Nazarbaev�s visit to Iran this theme is espacially significant.
There is the only one small �but�. With the current (and realistically achievable) oil production in Kazakhstan, the country just does not need any new large export arteries. CPC will be enough, and the capacity of the Samara pipeline and tanker transportation through the Caspian Sea may be increased. There are only three variants (and it is possible that their combination will be required) to provide the new pipeline with necessary oil to transport:
- To find a gigantic deposit in the Caspian shelf;
- A radical improvement of the situation in the privatised oil enterprises in Western Kazakhstan. These enterprises should achieve the investment volumes, technical upgrade and growth of oil output at least partially complying with the indices projected in the former agreements. Actually, for almost two years following the privatisation of such objects as Zhanazhol, Kenkiyak, Karazhanbas, Zhetybai, Uzen (conditionally), the output at all these oil fields has fallen (not increased several times, as it was promised by the current owners).
- To turn a portion of Kazakhstan�s oil output in Tengiz to another direction, which is possible if Kazakhstan finally takes a decision to sell a part of its share (let�s say, 10%) and this will go to a non-American company.
A number of other pipeline ideas are supposed to be realised. The construction of the very important line from Kenkiyak to Atyrau is actively advised. Chevron is working on the oil pipeline from Tengiz to the port of Aktau. The Kazakhstan authorities and such companies as Chevron and Mobil actively promote the idea of �Kazakhstan� pipeline from Baku to Batumi.
It is difficult to say what factors have stirred up the situation. Possibly it was Timur Kulibaev being appointed to the post of the head of �Kaztransoil� or the encouraging example of the CPC (pipeline to Novorossyisk). Perhaps the latest activity is due to negative factors: the disappointment of foreign companies in the work with large existing oil companies, the absence of any good news about new oil-fields or of fresh ideas on oil prospecting and mining. It does not matter. The revived idea may be only welcomed, even if the main objective is only to support the falling interest in the Kazakhstan oil industry. Never give-up, now the main thing is a pipe!
ALMATY, June 24
(THE GLOBE)
The first international conference on �Pension reform in Kazakhstan: results, problems and perspectives� was held in Almaty from 22 to 24 June.
High-ranking representatives of the Finance Ministry, Ministry of Labour and Social Defence, as well as the heads of the National Commission on Securities of the RK, Committee on Regulation of Accumulating Pension Funds, State and non-State Accumulation Funds, and foreign experts took part in the conference.
According to the conference�s organisers (the non-government Association of Pension Funds of Kazakhstan supported by the Soros-Kazakhstan Fund), the main aims of the conference were i) to sum up the results of the establishment of the non-State Accumulating Pension Funds in Kazakhstan, ii) to consider trends and perspectives in further developing the Accumulating Pension System, and iii) to study both foreign experience in reforming pension systems and the general results of the reform so far.
In the opinion of the professional participants of the Pension reform, the main problems of the reform at the present time are imperfect legislation, the absence of sufficient experience and professional personnel, and the uninformed population�s natural distrust of the Pension reform after other unsuccessful financial experiments.
At the same time, the participants of the conference state that, as evident by international experience, Kazakhstan does not have any other alternative but to continue the reform.
We should note that the new Accumulating Pension reform was introduced in January 1998 by the law �On pension provision in the Republic of Kazakhstan�. From that moment, the system has been considered to be practically completed. Presently, the state Accumulating Pension Fund (APF), 13 non-state APFs, 6 companies managing pension assets and the Committee on Regulation the Pension Funds work in the republic.
In the June 18, 1999 issue of THE GLOBE (#48(366)), an article entitled �The National Bank will not credit the Finance Ministry � the chairman of the National Bank� by Michail Sergeev was published. The article contained the following phrase: ��According to the prognosis of the chairman of the National Bank of RK, by the end of this year the rate of dollar will not increase by more than 1.5 times, as more growth will negatively influence the banks.�
The chairman of NB of the RK, Kadyrzhan Damitov believes the phrase could have been misinterpreted.
The National Bank announced that it does not see any premises to realise this pessimistic prognosis regarding the tenge�s devaluation. In addition, the NB of the RK thinks that a further reduction of the exchange rate is undesirable and may negatively influence the liquidity of the second level banks.
The editorialstaff presents its appologies.
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