Russia Takes Over Kyrgyzstan's Gas Network

Business » ENERGY | February 4, 2014, Tuesday // 14:29| Views: 1252 | Comments: 0
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Bulgaria: Russia Takes Over Kyrgyzstan's Gas Network

The Russian state is taking over control over Kyrgyzstan's natural gas transit and delivery network, after an agreement between the two states was signed into law.

According to the agreement, Kyrgyzgaz is to transfer its assets and rights, valued at some USD 40 M, to a company that is to be created in Kyrgyzstan.

Russian state gas giant Gazprom is to acquire 100% of Kyrgyzgaz's capital for the symbolic amount of USD 1.

The new entity have the obligation to deliver, store, and distribute natural gas, as well to maintain an expand the country's gas networks.

In particular, Gazprom has committed to invest no less than USD 566 M in Kyrgyzstan's natural gas infrastructure.

The Russian company has to further guarantee the security of all gass deliveries.

In return Kyrgyz authorities grant to Gazprom the exclusive right to import natural gas in the local markets, and non-interference in determining transit fees for gas passing through the country.

They also guarantee the company protection of its assets and daughter companies from expropriation and nationalization.

The period of the agreement is 25 years, with opportunities for an unlimited number of 5-year renewals.

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