A new British-Kazakh enterprise – “Batumi Terminal” was set up

FROM THE REDACTION

With the purpose of stopping the drop in the volume of oil transportation through the Georgian transit corridor, the owners of Batumi oil terminal found a new strategic partner – Kazakh company “KazTransOil”, “Black Sea” agency reports.

On the basis of the memorandum between British company ,,GREENOAK” and “KazTransOil” a new British-Kazakh joint enterprise “Batumi Terminal” was set up, by means of which stability of oil supplies through the Georgian transit corridor will be provided.
As the Chairman of Batumi Oil Terminal Ian Bonden Nilsen pointed out, works at the Georgian transport corridor has been successfully implemented since 1999. During the period of 7 years the transit of oil and oil products through the railway corridor has increased three fold. “This year we shall transport 12 million tons of oil and oil products through this corridor”, said Ian Bonden Nilsen. However, in relation to launching of “Baku-Tbilisi-Jeikhan” oil pipeline, the volume of transportation of Azerbaijani oil through the Georgian railway transit corridor is sure to decrease. For some time Batumi Terminal has been looking for a partner having a strong resource base and found it in the person of “KazTransOil” company, which is included in the structure of the state company “KazMunaiGaz”.
“Kazakhstan, Azerbaijan and Turkmenistan are large oil producing countries, but only Kazakhstan has the sufficient volume of oil in order to support both “Batumi-Tbilisi-Jeikhan project and Batumi Terminal”, said Ian Bonden Nilsen.
According to his words, in the next 10 years the total volume of oil supply in Turkmenistan will not exceed 16 million tons a year. The annual volume of Azerbaijan’s oil production will be more than 60 million tons, but a considerable part will be transported through Baku-Tbilisi-Jeikhan oil pipeline. “It is Kazakhstan, where oil production will rise to 170 million tons by 2015, which will be 100 million tons more compared to the current indicator, that represents a potential for Batumi”, the Chairman of Batumi Terminal believes. He also pointed out that Batumi Oil Terminal provides for 60% of incomes of the Georgian railway. In the opinion of Ian Bonden Nilsen, reduction of the transportation volume of oil and oil products through the Georgian railway corridor would lead to catastrophic consequences for both the terminal and the Georgian railway. According to his words, this strategic union renders assistance to more than 20 thousand Georgian workers who are employed at the mentioned rout.
This partnership, Ian Bonden Nilsen said, is also important for Kazakh partners, since it gives Kazakhstan an opportunity for business participation in transportation and provides the Kazakh oil producing company with a direct outlet to the Black Sea.
On the other hand, the President of “KazMunaiGaz” Uzakbai Karabalin confirmed that this cooperation is profitable for the Kazakh part, since Kazakhstan is guided by the strategy of diversification of oil export routs. “Our task is that oil supply through the Georgian corridor should be permanent and reliable”, he said. At this stage, proceeding from business interests, the parties do not name the volume of oil and oil products transported through the Georgian railway corridor, but it is pointed out that the priority task is to retain the current volume of transportation of oil and oil products.
,,GREENOAK” company privatized Batumi Terminal in 1999. In that period the terminal processed only 3-3,5 million tons of oil a year. Reconstruction of the basic part of the terminal has been carried out. The volume of investments made up more than 52 million USD. In 2004 the terminal was already able to process 9 million tons of oil and oil products. The maximal capacity of the terminal is 15 million tons of oil a year.
Besides, last December “GREEN-OAK” company purchased the 100% share of “Batumi Petroleum Storage Depot” and 11.4% of the state share in “Batoilimpex”. This May “GREENOAK” won the competition for the management right of the 100% state share of “Batumi Sea Trade Port” for the period of 49 years.