MOSCOW, August 5 (RIA Novosti) - Gazprom will acquire a controlling stake in Kyrgyzstan's national gas company, following agreement between the Russian energy giant and the Kyrgyz government, the Central Asian republic's ambassador to Moscow said on Wednesday.
"The issue of Gazprom's direct participation in the privatization of Kyrgyzgaz and its acquisition of a controlling stake has been settled," Raimkul Attakurov said.
The Kyrgyz parliament committee for international affairs approved on June 15 a draft intergovernmental agreement on Gazprom's participation in the sale of a government stake in Kyrgyzgaz.
Tursun Turdumambetov, chairman of the Kyrgyz State Committee for State Property Management, told parliament the Russian government proposed acquiring 75% plus one share in the national gas company.
The Russian side undertook to supply the Central Asian republic with natural gas at tariffs approved by the Kyrgyz government, and also to modernize and upgrade equipment and carry out major repairs of trunk gas pipelines.
An estimated $400 million is required to bring the state of the Kyrgyz gas industry up to an acceptable standard.
Kyrgyzstan's proven natural gas reserves are estimated at 6 billion cubic meters. However, the development of gas fields is impeded by geological factors and underdeveloped infrastructure.
Kyrgyzstan produces only about 30 million cubic meters of gas annually as compared with annual consumption of around 750 million cubic meters.
In May 2003, Gazprom and the Kyrgyz government signed an agreement on cooperation in the gas industry for a term of 25 years.
