Japan Bank for International Cooperation (JBIC) has signed a loan agreement totalling up to US$50mn with Development Bank of Kazakhstan (DBK). The loan is co-financed by Mizuho Corporate Bank. JBIC has guaranteed this portion.
DBK is a government financial institution with a mandate to meet medium and long-term financial needs for economic infrastructure development in Kazakhstan. The loan will provide medium and long-term funds, through DBK, for infrastructure development and expansion projects that are aimed at shipping energy resources produced in the country. These projects will help secure export routes for Kazak resources, thereby facilitating a stable supply of energy resources not only to Japan but to the international market as well. This will be the first untied loan JBIC will provide for a CIS country.
Large-scale oilfields are being developed in the Caspian Sea area that borders Kazakhstan and Azerbaijan. Among them are the Kashagan and Azeri-Chirag-Gunashli (ACG) oilfields, where Japanese oil developers have been participating in the development.
With the completion of the BTC pipeline this area has attracted the attention of the Japanese oil industry as a new energy supply source outside of the Middle East. JBIC has provided comprehensive support totaling US$2.7bn for these projects by utilising a wide range of its financing facilities.
In particular, Kazakhstan ranks second to Russia among CIS countries in terms of its crude oil endowment, natural gas, and other resources.
This loan is part of a comprehensive support package that JBIC is providing for the Kazakh government agencies as a strategy to diversify Japan’s energy supply sources.
Similarly, JBIC has signed an agreement on a comprehensive strategic partnership with KazMunayGas (KMG), a state-owned oil and gas enterprise in Kazakhstan.
The pipeline transports crude oil produced by ACG and other oilfields in the Caspian area from Baku (Azerbaijan) to Ceyhan in Turkey, via Tbilisi (Georgia). The pipeline stretches 1,750km in total and has the capacity to ship 1mn barrels per day.