MREK Privatisation and Transformation



Project number:


Business sector:

Power and energy

Notice type:


Environmental category:


Target board date:

14 Feb 2018


Concept Reviewed

PSD disclosed:

07 Dec 2017

Project Description

A senior loan of up to KZT 14 billion (equivalent to EUR 35 million) to support business transformation and development of Mangistauskaya Regional Distribution Company (MREK) following its privatisation by Kazakhstan Utility Systems (KKS), a private power utility in Kazakhstan.

Project Objectives

The project will support the modernisation and energy efficiency improvements of distribution networks, including the installation of modern automatic control systems and smart meters. Proceeds of the loan will be used to cover the planned investment programme of newly-acquired MREK alongside a number of retroactively financed capital expenditures.

Transition Impact

The project is in line with the Bank's Green Economy Transition (GET) initiative. Modernisation of MREK's facilities will ultimately lead to the improved stability and reliability of energy supply, a reduction of losses and increased potential of the system to support the integration of RES in the national distribution network.

Additionally, the project will increase private sector participation in Kazakhstan's energy sector which is still dominated by 100% state-owned JSC Samruk Energy.

Client Information


KKS is a private, vertically integrated utility company established in 2008 with operations in three segments: electricity and heat generation, electricity and heat distribution and supply in Karaganda, South and East Kazakhstan regions. KKS is rated BB- by Fitch and has more than 10,000 employees.

EBRD Finance Summary

KZT 14,000,000,000.00

Total Project Cost

KZT 27,000,000,000.00

Environmental and Social Summary

The project has been categorised B in line with EBRD's 2014 Environmental and Social Policy (ESP). The financing of the investment programme of the newly acquired MREK by the KKS aiming at modernisation of the distribution networks and energy efficiency improvements is associated with E&S issues that can be readily identified. The ESDD will be carried out by an independent consultant and will focus on review of the corporate E&S management systems of KKS and MREK and E&S Assessment of the MREK's investment plan 2016-2020, including any elements that can be potentially categorised differently under the ESP. The risk assessment procedure will be developed to determine E&S issues of the sub-projects of the investment plan. The NTS and SEP will be prepared and published on the Company's website to facilitate information disclosure on the project.

The PSD will be updated following the ESDD completion.

Technical Cooperation

The Bank will provide a TC assignment on a cost sharing basis with the client under the existing framework programme "Green Economy Project Preparation and Implementation Framework". The assignment will review the existing investment programme, confirm appropriateness, perform cost/benefit analyses and make recommendations for improvements.

Company Contact Information

Sultan Akhanov


7F, 14/3, Kunayev Street, BC Nursaya, Astana, Kazakhstan 010000









Business opportunities

For business opportunities or procurement, contact the client company.

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Text of the PIP

Project Complaint Mechanism (PCM)

The Project Complaint Mechanism (PCM) is the EBRD's accountability mechanism. It provides an opportunity for an independent review of complaints from individuals and organisations concerning EBRD-financed projects which are alleged to have caused, or are likely to cause, environmental and/or social harm.

Please visit the Project Complaint Mechanism page to find information about how to submit a complaint. The PCM Officer ( is available to answer any questions you may have regarding the submission of a complaint and criteria for registration and eligibility, in accordance with the PCM Rules of Procedure.