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GAS PROCESSING PLANT SLATED FOR TENDER

Oil&Gas Materials 24 June 2005 14:04 (UTC +04:00)

The Government of Azerbaijan announced a tender on the privatization of Azarbaycan Qaz Emali, a gas processing facility located in Baku’s Garadagh District.

According to a source close to the government, put up for the auction are some 87.14 per cent of the entire share portfolio of the plant, with the remaining shares distributed among the staff of the plant. “The original procedure meant that 15 per cent of all shares will be distributed among the staff members, however, due to high prices of the shares, the employees could afford only 12.86 per cent of the entire share portfolio,” the source added.

Tender bids are available till July 21, with the assessment procedure scheduled for July 25. The privatization will be held on an investment contest basis. Participants are required to submit a bank guarantee for one billion manats (roughly 0.21 million U.S. dollars), with the winner to produce additionally 300,000 vouchers to the Ministry of Economic Development, and make budget remittances totaling 5.5 billion manats (roughly 1.17 U.S. dollars).

The facility came on stream in 1961 and is capable of processing annually 6.5 billion cubic meters of gas and 0.65 million tons of liquids.

The Azerbaijan International Operating Company (AIOC) and the State oil company of Azerbaijan (SOCAR) have reduced вЂ" since January through May 2005 вЂ" gas supplies to the facility for treatment. Over the reported period, SOCAR has supplied 17.6 million cubic meters of gas, down 1.1 million cubic meters as compared to the year-ago figure; the company’s performance fell 40.1 per cent short of the interim target too. Meanwhile, AIOC has delivered 7.6 million cubic meters of gas (-0.4 million cubic meters as compared to the year-ago figure), down 35 per cent from the interim target. In total, the facility has processed 25.2 million cubic meters of gas, down 1.5 million cubic meters from the corresponding figure of January-May 2004; the target [for the current year] has been executed by 61 per cent only.

The plant posted a working capital of 19.36 billion manats (4.1 million U.S. dollars) and general liabilities of 422.04 billion manats (89.4 million U.S. dollars) on its balance sheet as of May 1, 2005.

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