KAZAKHSTAN: PAVLODAR CHEMICAL PLANT SOLD

UNCLAS ASTANA 001117

SIPDIS

SIPDIS

STATE FOR SCA/CEN (M. O'MARA) AND ISN/CTR (E. CAMERON)

E.O. 12958: N/A
TAGS: PARM PREL CBW CWC KZ
SUBJECT: KAZAKHSTAN: PAVLODAR CHEMICAL PLANT SOLD


1. The Pavlodar Chemical Plant was sold at auction on March
26 to Bazalt PV for 1.5 billion tenge ($13 million). All of
the plants assets - the buildings on the plant's territory,
equipment and transport, and the Bylkyldak retention lake -
were sold as one lot. Little is known about Bazalt PV. In
response to press inquiries, neither the bankruptcy
administrator nor the Pavlodar Oblast Department for Industry
were able to provide any information about Bazalt's
activities. The company has not yet announced whether it
will resume chemical production at the plant.


2. The auction marked a third attempt to sell the Pavlodar
Chemical Plant after it declared bankruptcy in 2005. Each of
the first two auctions attracted only one bidder because of a
requirement that all bidders possess a phosphorus
pentasulphide handling license. Three bidders participated
in the third auction after the handling license requirement
was dropped. The two losing bidders challenged the legality
of the auction, claiming that Bazalt submitted its tender
documents after the deadline for auction registration. On
April 19, a Pavlodar Oblast court dismissed the claim of the
losing bidders.
ORDWAY