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EBRD in $81 million loan for Kazakh export pipeline
10-year loan for project run by Kazakh pipeline operator and China's largest oil group
The European Bank for Reconstruction and Development has lent a company
jointly run by Kazakhstan’s oil pipeline operator and China’s largest oil and
gas group $81.6 million for a project linking the landlocked country’s
oilfields to its main export routes.
The 10-year loan will allow Closed Joint Stock Company MunaiTas to refinance
debt incurred in constructing part of its 448-km oil pipeline connecting
oilfields in the Aktobe region of central Kazakhstan to the Caspian Pipeline
Consortium and the Atyrau-Samara export pipelines.
MunaiTas is 51 percent owned by KazTransOil (KTO), Kazakhstan’s national
pipeline operator. The remaining 49 percent is held by CNPC International
(Kazakhstan) LLP, a wholly owned subsidiary of China’s Chinese National
Petroleum Company.
Known as the Kenkiyak-Atyrau oil pipeline, the link cuts transport costs and
opens up the export potential of oilfields in Central Kazakhstan by giving
them access to international markets. Further work on doubling the pipeline’s
capacity is planned.
Its design would also allow the flow of oil to be reversed, switching the flow
east instead of west and thus enabling it to become part of the potential oil
pipeline connecting the energy-rich Caspian region with China in the future.
The EBRD loan, initially guaranteed by KTO, will enable the borrower to repay
an expensive cash-collateralised bridging loan and give it the option to
switch later to project finance. At that point we could syndicate up to one
third, said Bert van der Toorn, Deputy Director of the EBRD’s Natural
Resources Team at the signing ceremony in the Kazakh capital, Astana.
The borrower has agreed to implement an Environmental Action Plan and the
EBRD’s participation will in addition encourage enhanced operational
transparency through the setting of transparent policies on tariffs and
pipeline access. This is part of the Bank’s efforts to stimulate the
development of institutions, laws and policies that directly promote the
functioning of a sustainable market economy, Mr. van der Toorn added.
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