Press Releases

05.06.2020

JSC NC KazMunayGas needs to obtain the creditors’ approvals to divest JSC KazTransGas

Mr. Alik Aidarbaev, the Chairman of the Management Board of JSC National Company KazMunayGas (“KMG” or “Company”), proposed moving JSC KazTransGas (“KTG”) directly under SWF Samruk-Kazyna management. This was proposed at a regular meeting of the Management Council of Samruk-Kazyna chaired by Nursultan Nazarbayev, the First President of the Republic of Kazakhstan.

During his speech, the CEO of KMG highlighted that the robust oil and gas transportation infrastructure was developed in Kazakhstan over the years of its independence.

“During the period of infrastructure development, the presence of these companies in KMG was fully justified. It was necessary to centralize all resources to develop a diversified network of transportation routes. To date, all these works are almost completed and the two companies have already become self-sufficient. In this regard, it is proposed moving KTG directly under Samruk-Kazyna management at the initial stage. This will reduce subholding levels, retain infrastructure projects under the State in case of IPO of KMG, and allow KMG to focus on exploration, production and oil and gas refining, and petrochemical projects,” Alik Aidarbaev stated.

The proposal was supported by Nursultan Nazarbayev, who instructed to work on the issue.

Currently, KMG has begun working out on the instructions related to KTG. It is necessary to obtain the appropriate consent of state bodies, as well as the approval of the Boards of Directors of Samruk-Kazyna and KMG.

Negotiations will be held with other interested parties, KMG has engagements with. KMG will have discussions with its creditors, including the Eurobonds holders, to provide clarifications on the transaction, the reasons for its execution and to obtain their consent. Decisions on the structuring of the transaction will be made taking into account the interests of all stakeholders, as well as the impact on KMG's credit ratings.

The issue on JSC KazTransOil will be considered additionally at a later stage.