The EDB and DBK to finance the construction of Phase 1 of the Saryarka gas pipeline
The Eurasian Development Bank (EDB) and the Development Bank of Kazakhstan (a subsidiary of the Baiterek National Managing Holding; DBK, Bank) opened financing to construct Phase 1 of the Saryarka gas pipeline. The respective agreement was signed in Nur-Sultan on 3 July.
According to the financing scheme approved by the banks, the EDB, as the syndicate leader, purchased AstanaGas KMG’s (a project vehicle and a subsidiary of the Samruk-Kazyna Sovereign Wealth Fund) ten-year bonds for a total of KZT 102 billion. The transaction was financed from the EDB’s own funds in the amount of KZT 51 billion, and a loan for the same amount from the DBK. Hence, the total project financing extended by the DBK and EDB amounted to KZT 102 billion, and the total project cost is KZT 267.3 billion.
The project is being financed through a bond programme, which includes two bond issues, for KZT 85 and 102 billion, respectively. The first issue was successfully placed in December 2018. The financial advisor and project underwriter is SkyBridge Invest.
The project aims to achieve Kazakhstan’s strategic objectives in ensuring the country’s energy security, reliable and uninterrupted gas supplies to the central and northern regions, and improvement of the environment. Financing will also cover the construction of the Kyzylorda–Zhezkazgan–Karaganda–Termirtau–Astana gas pipeline to ensure gas supplies to Astana, and the country’s central and northern regions.
In particular, it is planned to gradually ensure gas supplies to 171 towns and villages located along the first section of the pipeline. The project plans to create up to 900 jobs during the construction phase, and 194 jobs during the operation phase.
The Eurasian Development Bank (EDB) is an international financial institution founded by Russia and Kazakhstan in January 2006 with the mission to facilitate the development of market economies, sustainable economic growth, and the expansion of mutual trade and other economic ties in its member states. The EDB's charter capital totals US $7 billion. The member states of the Bank are the Republic of Armenia, the Republic of Belarus, the Republic of Kazakhstan, the Kyrgyz Republic, the Russian Federation, and the Republic of Tajikistan.
The Development Bank of Kazakhstan (DBK) is a national development institution established in 2001 to modernise and develop the non-primary and infrastructure sectors of Kazakhstan’s economy. Its key areas of operation include the development of production infrastructure and the processing sector, and promoting and attracting foreign and domestic investment in the country’s economy. The DBK is one of the largest investment operators of the state-run programmes for industrial and innovative development. It is a subsidiary of the Baiterek National Managing Holding.
AstanaGas KMG is a subsidiary of the Samruk-Kazyna Sovereign Wealth Fund and Baiterek Venture Fund established to implement the Saryarka project.
SkyBridge Invest (SBI) is a successful investment company with significant experience in Kazakhstan’s securities market. SBI arranges structuring of, and support for, merger and acquisition transactions, debt restructuring, project financing and borrowings, and takes part in other important projects both in Kazakhstan and other CIS countries.
The Development Bank of Kazakhstan’s Public Relations Department: 8 (7172) 79 26 08 (www.kdb.kz, facebook.com/kdb.kz, Twitter@KDBkz)
The Eurasian Development Bank’s Media Centre:
Alexander Savelyev +7 (985) 765 23 59 (Moscow)
Azima Sapargaliyeva +7 (777) 750 00 08 (Almaty)
Sergey Gorbachev +7 (916) 727 22 00 (Moscow)