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Press Release from the US TDA (May 12, 2005)

ASTANA, KAZAKHSTAN - (May 12, 2005) Yesterday, the U.S. Trade and Development Agency (USTDA) awarded a $640,000 grant to the Ministry of Energy and Mineral Resources of the Republic of Kazakhstan to partially fund a feasibility study for the Poltoratskoye and Akyrtobe Underground Gas Storage Project that was proposed by KazTransGas. The grant is an example of the agency's commitment to assist the Government of Kazakhstan in its efforts to expand its energy sector infrastructure and to regulate and stabilize seasonal natural gas demand with sufficient supply. The grant was conferred in a signing ceremony held at the Ministry of Energy and Mineral Resources. The Honorable John M. Ordway, U.S. Ambassador to the Republic of Kazakhstan, signed the grant agreement on behalf of the U.S. Government. The Honorable Batyrgozha Izmukhambetov, First Deputy Minister of Energy and Mineral Resources, signed on behalf of the Government of Kazakhstan. Mr. S. Sultangaliev, General Director of KazTransGas; Mr. Timur Kulibayev, Vice President of KazMunaiGas; and Mr. Peter Andreoli, Economic Attache at the U.S. Embassy in Kazakhstan, were present at the grant signing.

KazTransGas, a state-owned company and subsidiary of KazMunaiGaz, is engaged in the production, transportation, storage and sale of natural gas in the Republic of Kazakhstan. It is one of the largest companies in Kazakhstan and controls the country's gas pipeline system. Currently, KazTransGas is planning to reconstruct its Poltoratskoye and Akyrtobe interconnected underground gas storage facilities. Because these facilities represent two of Kazakhstan's three underground gas storage facilities, they are important to the nation's ability to balance its seasonally variable gas demand with supply. Both facilities were built 15-20 years ago, and their major systems, such as gas compression, dehydration, and control automation must be upgraded or replaced.

The USTDA grant will be used to partially fund a feasibility study on the operational, financial and economic viability of the reconstruction plans. The Ministry of Energy and Mineral Resources has selected BSI Industries, Inc. of Columbus, Ohio as the U.S. company that will perform the feasibility study.BSI Industries will also contribute resources toward the completion of the study.

The U.S. Trade and Development Agency advances economic development and U.S. commercial interests in developing and middle-income countries. The agency funds various forms of technical assistance, feasibility studies, training, orientation visits and business workshops that support the development of a modern infrastructure and a fair and open trading environment. USTDA's strategic use of foreign assistance funds to support sound investment policy and decision-making in host countries creates an enabling environment for trade, investment and sustainable economic development. In carrying out its mission, USTDA gives emphasis to economic sectors that may benefit from U.S. exports of goods and services.