RIGA - One of the main topics of Kazakh President Nursultan Nazarbaev's visit to Riga in July is likely to be a possible purchase of the Ventspils Nafta oil terminal, a stake in which the government intends to sell later this year.
Kazakhstan's former economics minister, Maxat Kabashev, who is now deputy chairman of the National Innovation Fund, told the Latvian daily Bizness & Baltija at an international economic forum in St. Petersburg that the possibility of acquiring a stake in Ventspils Nafta was being negotiated.
He added that in the nearest future Kazakhstan planned to start wide acquisition of strategic transportation assets and the construction of its own terminals at the ports of several countries. Azerbaijani, Georgian, Latvian, Lithuanian and Estonian ports were in the focus of Kazakh interest.
Kazakhstan has already built a grain-reloading terminal, Ventspils Grain Terminal, in the Latvian port. The terminal began operations in August 2005.
Kazakhstan is regarded as one of the most lucrative oil hotspots in the world, and is being courted by numerous investors and governments, including the United States. But the country's oil industry lacks downstream assets, including access to oil export terminals that would help it deliver its increasing crude output to Western markets. (See story on Page 16.) The recent attempt by KazMunayGaz, the country's state-owned oil and gas company, to purchase a Russian company's stake in Mazeikiu Nafta, Lithuania's oil refinery, ended in failure. Nazarbaev make a personal plea on behalf of the company during the half-year ordeal surrounding the refinery sale.
Interestingly enough, this week it was announced that Nazarbaev's son-in-law, Timur Kulibaev, was appointed chairman of the board of KazMunayGaz.
The Latvian state plans to sell the state-held 38.62 percent stake in VN on the Riga Stock Exchange in three months at no lower than 1.81 lats (1.42 euros) per share.
Still, any purchase of the state's stake, by any investor domestic or foreign, poses difficulties as Ventspils Nafta's largest shareholder, Latvijas Naftas Tranzits, controls the oil terminal. In fact, the state finally decided to sell the stake since its efforts to cooperate with LNT never bore fruit.
According to Andrejs Pildegovics, foreign affairs advisor to Latvian President Vaira Vike-Freiberga, Nazarbaev will visit Latvia on July 19-20 to discuss bilateral relations and economic ties.
It will be the first visit of a Kazakh leader to Latvia since the restoration of independence in 1991.
Nazarbayev and his delegation also plan to visit Ventspils, where they will discuss bilateral relations and economic cooperation.
"Of course, Kazakhstan is a significant player on the energy market and a major EU partner in this respect," said Pildegovics, describing Latvia's economic interests.
He said that Kazakhstan was looking for new export routes and might be interested in Latvia as a transit country.
Latvian President Vaira Vike-Freiberga made a state visit to Kazakhstan in October 2004, and Latvia's previous president Guntis Ulmanis also went to Kazakhstan during his term in office.
