Photo:
| Other Photos |
 |
|
 |
Russia Has Own Ideas about Pipeline Income
Kommersant has learned the nature of the objections of KTK stockholders to the current edition of the memorandum of understanding on the pipeline’s expansion from 32 million to 67 million tons of oil, which has been signed by the appropriate ministries in Russia and Kazakhstan. They concern the calculation of the interest on the consortium’s debt to investors. Private investors are counting on receiving 6-percent compound interest. The second point of contention is the requirement that all foreign specialists working on the project be put on the payroll of either KTK-R or KTK-K. As a result of that rule, about 30 employees receive significantly greater salaries than the 600 others. Transneft vice president Mikhail Barkov told Kommersant about these issues.
KTK is the only private oil pipeline in Russia. It connects Tengiz, Kazakhstan, with Novorossiisk. Its state shareholders are Russia (whose 24-percent share is managed by Transneft), Kazakhstan (19 percent) and Oman (7 percent). In addition, shareholders include Chevron (15%), LUKARCO (12.5%), Rosneft-Shell Caspian Ventures (7.5%), Mobil Caspian Pipeline Company (7.5%), Agip (2%), BG (2%), Kazakhstan Pipeline Ventures (1.75%) and Oryx Caspian Pipeline (1.75%).
The issue of interest calculation arose several years ago. Russia is dissatisfied that KTK does not pay dividends, but uses its income to repay its debts to private investors. The issue of workers’ salaries is not considered substantial. They are paid under contracts agreed to by both sides. Analysts say the disagreement is more fundamental than it appears, but the sides will be forced to compromise. Russia understands that the pipeline has to be expanded while the oil lasts, and the private investors understand that alternative routes to move oil out of Tengiz are too expensive. Connecting Tengiz to the Baku-Tbilisi-Ceyhan pipeline would cost $4.5 billion (as estimated two years ago), while the expansion of KTK will cost only $4 billion.
www.kommersant.com
All the Article in Russian as of May 26, 2008
|
|
|
