EBRD to finance gas projects in Kazakhstan

May 26, 2016 12:00 AM

The European Bank for Reconstruction and Development (EBRD) will provide up to 294 million euros in local currency equivalent for two ground-breaking projects to increase the use of domestically produced natural gas and largely replace the use of coal in Kazakhstan.

The corresponding agreement was signed by EBRD President Suma Chakrabarti and Chairman of the Board of KazTransGas Kazakh gas transportation company Kairat Sharipbayev, the press service of the Kazakh company reported May 26.

The first project is the upcoming modernization and refurbishment of the underground storage in Bozoi in the bank's first-ever cooperation with the national gas company KazTransGas.

An EBRD loan equivalent to 242 million euros in local currency to the KazTransGas subsidiary Intergas Central Asia will allow for the upgrade of the storage to its full capacity of 4 billion cubic meters (bcm), from the current limit of 2.6 bcm.

This planned upgrade of the storage capacity will help ensure the stable supply of gas from the west of the country to the populous south-eastern regions and ultimately reduce dependency on coal-generated electricity.

The second project is a loan in tenge equivalent to 52 million euros to KazTransGas-Aimak for the expansion and modernization of the natural gas distribution network in several regions of Kazakhstan. The upgrade will allow the company to connect new households and industrial customers to gas supplies, replacing the current carbon-intensive energy sources, mainly coal.

To date, the EBRD has invested over 6.5 billion euros in the Kazakh economy. The bank is active in all sectors of the economy with a focus on diversification and sustainable energy. The EBRD and Kazakhstan are also linked with each other in a comprehensive partnership agreement.

KazTransGas is the national operator of Kazakhstan in the sphere of gas and gas supply. The KazTransGas group includes businesses and organizations producing, transporting and selling gas and its refined products.

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