East Siberian Gas Company OJSC to Be Set Up by March
21 Jan 2004
The Irkutsk Region and TNK-BP plan to have East Siberian Gas Company OJSC registered by March 2004, informed Alexey Sobol, Deputy Head of the Regional Administration. In his words, the company''s constitutive documents are under consideration of the parties. The foundation meeting of the joint-stock company where the articles and memorandum of association are to be reviewed is scheduled for late January - early February. The Irkutsk Region and TNK-BP intend to act as founders of East Siberian Gas Company on a parity basis. The capital stock of the company is expected to come to RUR 30 million. As was announced earlier, the regional administration and TNK-BP proposed that Gazprom should join them as a founder. In a long term, one of major gas consumers in the Irkutsk Region is likely to become a stockholder in the company. East Siberian Gas Company would manage gas supplies from the Kovykta gas condensate field to the Irkutsk Region. As was announced earlier, capital spending on this regional project is estimated at US$ 676 million in 2004/2034, including US$ 480.4 million in 2004/2006. 70% of funds to implement the project is to be raised in the Russian Savings Bank, 30% will be funded by TNK-BP from its shareholders'' equity. The first gas supplies from the Kovykta field to the Irkutsk Region market may start at 300 million cubic meters in 2006. In 2007, supplies to the regional market are to reach 2 billion cubic meters and are expected to hit 2.2 billion cubic meters by 2009. The project''s payback period is 8-9 years if gas prices stand at US$45-US$50 per 1,000 cubic meters. The price of US$50 per 1,000 cubic meters for Kovykta gas in the domestic market is expected to be competitive. Kovykta''s gas will pass through pipeline to Sayansk where a gas-separation works and an ethane-pyrolysis plant will be situates, and thence to Angarsk. Kovykta''s gas consumption will be concentrated in such industrial towns as Angarsk, Sayansk, Irkutsk, and Usolje Sibirskoye. Potential consumers of Kovykta''s gas include, in particular, KhimpromUsolje, Irkut NPK, Sayanskkhimplast, East Siberian Railway, Irkutskteploenergo, Angarsk Petrochemical Company, and the Angarsk polymer works. According to the project implementation program, investment justification, feasibility study, and working projects'' coordination should have been finalized by the end of 2005. Bases where production facilities are to be constructed will start to get prepared to construction in the fall of 2004. Source INTERFAX
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