Kazakhstan in World news: february — march, 2008

Gazprom to buy Central Asian gas at «European prices»
The Associated Press Published: March 11, 2008

MOSCOW: Former Soviet Central Asian countries will begin selling natural gas at European levels next year, Russia’s state-controlled monopoly said Tuesday, which could result in markedly higher prices for European consumers.
The decision «is based on the interests of the national economies and takes into account international obligations to ensure reliable and uninterrupted energy supplies,» said a statement released after a meeting between OAO Gazprom head Alexei Miller and the heads of the national gas companies of Kazakhstan, Uzbekistan and Turkmenistan.
The brief statement did not specify how the «European prices» would be calculated. But it appeared to foretell a significant hike for end users because Gazprom currently buys gas from these countries at comparatively low prices before reselling it to Europe.
Gazprom estimates that its average price for European contracts this year will be about US$354 (€230) per 1,000 cubic meters, whereas it currently buys Turkmen gas for US$130 (€85) per thousand cubic meters, according to the state news agency RIA-Novosti.
The Central Asian gas consumed in Western Europe travels through pipelines controlled by Gazprom.

Kazakhmys EPS up
By Eric Onstad Reuters Published: March 6, 2008

LONDON: Kazakhmys , the world’s 10th biggest copper producer, posted a 0.7 percent rise annual earnings per share on Thursday, lower than market forecasts after flooding and processing problems cut output.
It said 2008 might be another tough year, but output should at least equal that of last year.
«There will undoubtedly be challenges in 2008, though we anticipate that copper cathode production should be at least the level of 2007,» a statement said.
Chief Executive Oleg Novachuk said the forecast might have some upside, but he was being cautious after problems in 2007.
«We are absolutely aware that probably we are overly conservative, but we have learned lessons that we cannot know everything that will happen over the year,» he told a results conference call.
In January, the firm released production data showing full-year copper output fell 6.3 percent to 381,200 tonnes, down from 407,000 tonnes in 2006.
Flooding at its South Mine in Zhezkazgan in September combined with slower pick-up in output from new concentrators curbed 2007 copper output.

SHARES UP AS COPPER RISES

The firm, whose main operations are in Kazakhstan, said EPS based on underlying profit rose to $3.02 in 2007 from $3.00 the previous year, coming short of a forecast of $3.07 in a Reuters Estimates poll of 10 analysts.
The shares, which have gained a quarter so far this year, gained 1.6 percent to 17.60 pounds by 0850 GMT as copper prices came within a whisker of matching a record high. This compared to a 0.4 percent increase in the UK mining index .
Analyst Charles Kernot at Seymour Pierce said the results were largely in line with expectations, but he reiterated a «sell» rating on the stock.
«The company’s future options for growth are focused on… longer term projects and so we see better near-term growth potential in Antofagasta . Fears about the copper market are, however, our overriding short-term concern.»
Kazakhmys said earnings before interest, tax, depreciation and amortisation (EBITDA) increased 1.2 percent to $2.34 billion (1.17 billion pounds) while underlying profit rose 0.5 percent to $1.41 billion.
The firm proposed a final dividend of 27.4 cents per share, which combined with the interim dividend represents a total dividend of 41 cents per share, up 7 percent.
The company bought back $390 million of shares last year and paid a special dividend of $235 million, but the outlook for further cash returns was uncertain, Novachuk said.
«Regarding the return to the shareholders, it will depend on the copper prices this year and it will depend on the projects were considering this year… we don’t exclude it if performance goes extremely well.»
Novachuk said the company was still on the lookout for more acquisitions after several major purchases in 2007, including the Ekibastuz power plant, Kazakhstan’s biggest, Eurasia Gold and a 14.6 percent stake in ENRC Plc .
«We are very well positioned in Kazakhstan for further deals… we will continue to do that in 2008 as well.»

Kazakh helicopter crash death toll rises to 5, senior official may be among dead 
The Associated Press Published: February 29, 2008

АSTANA, Kazakhstan: The death toll from a helicopter crash in southern Kazakhstan rose to five Friday, officials said, as the state news agency reported that senior officials were among the casualties.
The Emergency Ministry’s Russian-made MI-8T helicopter crashed Thursday while local officials were inspecting flooded areas in the Kzyl-Orda region.
The accident killed five people and seriously injured another 13, the Ministry said in a statement Friday. It said the cause of the accident was being investigated.
The state Kazinform news agency reported that a spokesman for the regional administration was among the dead and the regional governor and other local officials were among the injured.

Kazakhmys says it has no takeover proposal
(Reporting by Eric Onstad, editing by Will Waterman)
Reuters Published: March 13, 2008

LONDON: Kazakh copper producer Kazakhmys said it had received no takeover proposal from rival Eurasian Natural Resources , which said the previous day it might be interested in buying Kazakhmys.
Kazakhmys shares initially tumbled, sliding up to 10 percent, giving up much of the near 16 percent gains from Wednesday, but quickly pared the losses.
By 8:20 a.m., the shares were down 1.9 percent at 17.45 pounds, largely in line with the UK mining index.
«Kazakhmys notes the announcement made by Eurasian Natural Resources Corporation (ENRC). No proposal has been received by Kazakhmys,» it said, giving no further details.
ENRC’s announcement on Wednesday that it had held preliminary talks with Kazakhmys sent the shares racing to a record high and pushed up the firm’s market value to a peak of $17.3 billion (8.5 billion pounds).
ENRC — the world’s biggest producer of ferrochrome and the sixth-largest iron ore exporter by volume — said it held discussions with Kazakhmys as it explored possible strategic opportunities following ENRC’s London flotation in December.
An analyst said a move to combine the firms made sense due to the fragmented nature of the Kazakh mining sector, but that the speculation earlier this year was that Kazakhmys would be the suitor after it took a 14.6 percent stake in ENRC.

TAKEOVER PANEL

An industry source who declined to be named noted on Wednesday that the UK Takeover Panel requires firms to reveal when there have been any discussions of possible mergers, even at very informal levels, following sharp share movements.
The shares of both companies had been moving higher before ENRC’s statement on Wednesday, and this may have been partly because a statement was expected following the close of the market confirming that ENRC would move up into the FTSE 100 index .
Kazakhmys, the world’s 10th-biggest copper producer, is owned 45.8 percent by its Chairman Vladimir Kim, while Chief Executive Oleg Novachuk has a 7.7 percent stake.
Kazakhmys posted a 0.7 percent rise in annual earnings per share last week, lower than market forecasts after flooding and processing problems cut output.
It said 2008 might be another tough year, but added that output should at least equal last year’s.
The government of Kazakhstan owns 19.3 percent of ENRC, a company that had revenues of $3.3 billion in 2006, accounting for about 4 percent of the nation’s GDP.
Three founders of ENRC collectively own a further 43.8 percent of the firm, which employs around 62,000 people.
In addition to iron ore and ferrochrome, ENRC produces aluminium and alumina, runs power stations and operates a logistics unit.

More than 300 people were evacuated from their houses in Kazakhstan.
Arguments and Facts  Published: February 29, 2008,  07:15:55

Water from melted snow has wrecked a village school and 77 houses.
«More than 300 people were evacuated in the Alma-Ata region of Kazakhstan, where water melted from snow has wrecked 77 private houses», — writes the newspaper Gazeta.ru.
«Because of abundant precipitations, quick melting of snow and debacle of the leading canal by water melted from snow in the Kokdala village of Karatal region of Alma-Aty district, a village school and 77 houses, where 580 people reside, were ruined. Part of the population — 330 people were evacuated to the nearest village Yekseldy and were settled in a new place in the village school, and at their relatives”, — informed the press-service of Emergency Ministry.
Nowadays more than 130 rescuers and 39 technical units conduct works in the village. In the nearest future they need to erect an artificial dam at the place of the canal’s break, and equip drains for water’s pipe-bend.

Thousands homeless as severe flood hits Kazakhstan
(Writing by Maria Golovnina; Editing by Elizabeth Piper)
February 26, 2008

ALMATY (Reuters) — More than 12,000 people have fled their homes in Kazakhstan after rain-swollen rivers swept away houses and bridges, the emergencies ministry said on Tuesday.
Spring flooding is a recurring problem across Central Asia but a sudden rise in temperatures on February 20 following weeks of severe cold has exacerbated the problem this year.
One person was killed in the floods and 12,700 others had to be evacuated from Kazakhstan’s most populous region bordering Uzbekistan, the ministry said.
Melt water destroyed roads and schools and killed hundreds of cattle as rivers burst their banks.
The emergencies ministry said its rescue teams, equipped with boats and diving gear, were working to contain floods and assess the situation.
People were being evacuated to safe areas but it was unclear when they would be able to return home. A total of 2,000 houses have been destroyed.

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