IN THE NEWS / Hurricane Kumkol Munai OJSC Hurricane Opposes Monopolistic Practices <HHLa.AL>
10/30 14:35
Hurricane Kumkol Munai, a subsidiary of Hurricane Hydrocarbons Ltd. distributed the following release at a news conference held in Almaty, Kazakhstan on Friday, October 30, 1998.
ALMATY, KAZAKHSTAN, Oct. 30 - Hurricane Kumkol Munai OJSC continues to support President N.A. Nazarbayev's plans for a future of Kazakhstan based on market economy principles. As part of this mandate, the President supports policies which strive to eliminate corruption and monopolistic practices. Hurricane has taken a stand against monopolistic practices by requesting the government review the practices of the "Shymkentnefteorgsintex" (ShNOS) refinery in Shymkent.
In 1996 the ShNOS refinery had processing contracts with Yuzhneftegas, now Hurricane Kumkol Munai, as well as with other companies which purchased crude oil from Hurricane and processed it at the refinery. This ensured fair competition in the market but since the beginning of 1998 this fair competition has ceased to exist.
On August 4, 1998 Hurricane brought this issue to the Anti-Monopoly Committee (Shymkent regional branch) and outlined its concerns. A sample of these concerns included:
- Attempt by refinery to control 100% of all processing and denying oil producers access to process at the ShNOS refinery (clear, unrestrained monopoly).
- Exorbitant processing fees to levels significantly above the actual cost of processing.
- Deliberate delays in shipping oil products to Hurricane's customers.
- Failure to honor the payment terms agreed to for oil contracts.
- Refusal to give correct product yields and exaggeration of product losses during processing.
The Anti-Monopoly Committee ruled in Hurricane's favor on September 14, 1998. It stated in it's written report that ShNOS must resolve the issues brought forward by Hurricane. The refinery was given 10 days to address the issue. This time has expired with no attempt at resolution and the matter has been moved by the Anti-Monopoly Committee to the courts for resolution.
The management of Hurricane continues to support the work of the Anti-Monopoly Committee and the vision of President Nazabayev for a country operating under fair business practices. The company anticipates a speedy resolution. |
