2000-01-24 Kazak Politics & MacroEconomics - Chinese Oil Company
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Chinese Oil Company Unveils Its Plans
The Chinese National Petroleum Corporation (CNPC) plans to invest USD 120-130 million in 2000 to modernise the Aktobemunaigaz oil production company in Kazakhstan, which it controls. A top official at Aktobemunaigaz said that the Chinese concern has no intention of leaving the Kazakhstani market. The company will produce 2.5 million tonnes of oil this year, 200,000 tonnes more than in 1999, he said.
The company has managed to pay all wage arrears. However, the majority of the 2,000 workers who were laid off in April last year remain jobless. The workers were laid off when Aktobemunaigaz spun off its drilling, transportation and construction divisions. The management had promised the displaced workers jobs at successor companies and pledged to make unemployment payments equal to 30% of the previous wages until the workers were rehired.
In the summer of 1997, Kazakhstan and China concluded an oil production and pipeline construction deal worth a total of over USD 9.5 billion. In 1998 joint development began at the Uzen oil field and at the Aktyubinsk oil and gas field. CNPC acquired a 60% stake in Aktobemunaigaz for USD 325 million and agreed to invest USD 4 billion in the company over the following 20 years.
At the same time, according to figures announced in mid-December at a meeting of the local executive body in the Aktyubinsk region, CNPC only made 85.4% of the investment planned for 1998. Investment for 1999 was to total USD 117.4 million, but no more than USD 70 million was made. (Interfax, Bloomberg)