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Gazprom buys out Kyrgyzgaz for $1

Published time: April 10, 2014 09:52
Gazprom CEO Alexei Miller (RIA Novosti / Igor Zarembo)

Gazprom CEO Alexei Miller (RIA Novosti / Igor Zarembo)

Russia’s Gazprom has bought 100 percent of Kyrgyzgaz for a symbolic $1, as it also undertook to cover the company’s $40 billion debt. The deal makes Russia’s gas monopoly the sole gas supplier to Kyrgyzstan.

“It’s a historic day. Today we signed an agreement to acquire 100 percent of Kyrgyzgaz and this company is joining the big Gazprom family,” Gazprom CEO Aleksey Miller said Thursday.

Kyrgyzgaz will be renamed Gazprom Kyrgyzstan, and Gazprom plans to invest at least 20 billion rubles over the next five years.

“A goal of the new company is to provide reliable and stable gas supplies to all Kyrgyzstan customers at lower prices,” Miller said.

“To achieve that goal it’ll be necessary to renovate, modernize and reconstruct the existing transportation wires and trunk pipelines.”

As gas production in Kyrgyzstan is low and gas supply stands at just 25 percent, Gazprom aims to explore for new fields in the country.

“Economic stability is the most important thing. When people have gas and heat, they are confident in their future,” the Gazprom head said.

Gazprom has an exclusive 25-year deal to export gas from Kyrgyzstan, which will also protect the Russian company's investment from nationalization, and allow for the easy transfer of foreign payments connected with the investment.

Gazprom will also have the right to set gas tariffs for Kyrgyzstan supplies to third countries and determine the price of storing gas in underground storage facilities.

Comments (7)

 

Nick Blomme 11.04.2014 11:15

It no public secret that the immense public debt of Russia moved in 1998 to 2000 from state debt to companies owned by Russia. That's why Russian debt is so low.

 

Enis Fesci 11.04.2014 01:19

pytlar 10.04.2014 21:39

You know, Putin controls the valve: good boys gets discounts, bad gets "technical problems" during severe winter. Look at Ukrainian example

  


Hmm sounds familiar. Good boys who use the dollar to sell oil like Saudi Arabia and Dubai can run their country in the most undemocratic and uncivilized way. The countries that want to change the currency of oil to Euro or Gold, have democracy brought to them by USA.

 

pytlar 10.04.2014 21:39

and this is how russia is regaining their dominance in post-soviet area, First destabilize a country, than take over their energy systems. Boom, another vassal of Moscow. You know, Putin controls the valve: good boys gets discounts, bad gets "technical problems" during severe winter. Look at Ukrainian example

View all comments (7)
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