Tuesday, February 15, 2011

Kyrgyzstan, Russia Move Closer to New Agreement on Fuel Supplies to Manas

By Erica Marat

On February 10, the Kyrgyz-Russian intergovernmental commission on trade-economic, scientific and humanitarian cooperation requested the Kyrgyz government to form a special joint venture between Russian energy company “Gazpromneft-Aero” and Kyrgyzstan’s “Refueling Complex Manas." The joint venture will supply Russian fuel to the U.S. Transit Center at Manas airport.

Deputy Prime Minister on economic issues Omurbek Babanov said that the joint venture will be formed by end of this month and the company should begin work on the fuel supply by March.

President Roza Otunbayeva also said that she welcomes new opportunities for bilateral cooperation with Russia. Without mentioning the new joint venture, the president expressed her hope that new bilateral initiatives will be implemented as soon as possible.

Last year, when the U.S. Department of Defense renewed its contract with Mina Corp Ltd., the Kyrgyz government expressed its disappointment with the decision. According to government officials, Mina’s work in Kyrgyzstan lacked transparency and the company was engaged in corrupt deals with former president Kurmanbek Bakiyev.

Otunbayeva has been pushing for greater transparency in the government. However, despite the formation of a new joint stock company, questions of transparency in fuel contracts still remain. It is unclear who will be the main informal stakeholders of fuel supplies on the Kyrgyz side. Kyrgyz NGOs and journalists have been pressing for greater transparency in fuel contracts.

The Kyrgyz president has been pressing for the elimination of Mina from the equation, arguing that it would save up to $50 million per year. In an attempt to save its DoD contracts in Kyrgyzstan, Mina has launched an aggressive PR campaign to improve its image in Bishkek, Moscow and Washington. Mina representatives have been emphasizing that the Congressional subcommittee’s investigation did not find any major cases of corruption in the company’s work.

It also still remains unclear whether or not the Russian side supports Otunbayeva’s suggestion on ousting Mina from the existing contracts.

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