Thread by @nimkef

5 Dec 2000

Just when it seemed as though Calgary-based oil producer Hurricane Hydrocarbons was finally getting its business back on track, things once again took a turn for the bizarre last week.

theglobeandmail.com/report-on-busi…

The former chairman of the board at the company's Kazakhstan oil refinery, Nurlan Bizakov - who resigned in August after Hurricane took over the refinery - showed up with an armed guard and tried to seize control of the entire operation.

According to a BBC report, Mr. Bizakov apparently commandeered a militia group attached to the Kazakhstan Interior Ministry and tried to take over the refinery.

He told the refinery's banks to suspend all transactions, published a notice in the local newspaper declaring any stamps and official forms used by the company null and void, and said he would fire the security staff and replace them with members of the state militia.

The former chairman of the ShNOS (Shymkentnefteorgsintez) refinery has said that he was forced out of his position due to pressure from one of Hurricane's former local investors, the Kazkommertsbank, and has been fighting in state court to get reinstated.

The BBC's world monitoring service said that according to a Kazakh TV news report, the court recently ruled in Mr. Bizakov's favour, but Hurricane is arguing that his position has been eliminated and therefore there is no way to carry out the ruling.

The fact relations between Bizakov & Hurricane have deteriorated to the point where the he has to try and storm the refinery (what kind of govt dept has its own military?) won't come as a surprise to anyone who has followed the Hurricane Hydrocarbons soap opera in the past years

In fact, the latest turn of events is totally in keeping with the bizarre - at times even comical - goings-on in the former Soviet republic.

Hurricane made a splash on the Canadian scene when founder John Komarnicki bought the rights to a massive oilfield in Kazakhstan when the government agency controlling the field was privatized in 1996.

In addition the the Kumkol field, Hurricane essentially agreed to take control of a small town worth of workers inc. related properties:

the local soccer team
a recreation centre
a sheep and camel farm used in part to feed the staff
a local highway paving and maintenance company

When oil prices were soaring, Hurricane was a superstar, and a poster child for investment in the former Soviet Union, and its shares climbed as high as $14 in 1996.

Then the bottom fell out of the oil market, and at the same time the refinery started to raise the fees on oil that the company had no choice but to send to the ShNOS refinery. At the helm of the refinery through this whole battle was none other than chairman Nurlan Bizakov.

Both sides sought help from the Kazakhstan government, and when various state agencies made rulings on pricing arrangements, both sides put out multiple press releases arguing that they had won a clear victory.

It became obvious the solution to Hurricane's problems was to merge the company with the refinery, but that wasn't as easy as it sounds - a deal was on, then off, then on again.

Hurricane's revenues tanked, it's shares falling to a low of about $0.27 [in 1999]. Mr. Komarnicki resigned as CEO of Hurricane, replaced by Bernard Isautier, a French-born former chairman of Calgary-based oil firm Canadian Occidental [subsidiary of Occidental] (now CNOOC)

When the company had been written off by almost everyone, oil prices began to climb and Hurricane started to make money. In the most recent quarter, the company reported that its profit had more than tripled, and its stock price has climbed as high as $11.25.

Then, of course, along came Mr. Bizakov. It's hard to know whether the Bizakov affair has had any effect on Hurricane's share price, but the stock has fallen by more than $1 or more than 10 per cent to about $7.50 in just the past few days.

https://twitter.com/nimkef/status/1421314752920305666?s=20

Formerly known as Hurricane Hydrocarbons Ltd. the company was founded in 1981 and initially operated in Western Canada. It changed to a more international focus and grew after making several major oil and gas finds in Southern Kazakhstan

en.wikipedia.org/wiki/PetroKaza…

In 1991 it formed a JV to develop the Kyzylkiya, Aryskum, Maibulak and South Kumkol fields.

In 1996 it purchased Yuzhneftegaz from the Kazakh government, making it one of the largest players in the country.

All the company's oil went through refineries owned by Central Asian Industrial Holdings N.V. (CAIH), a Dutch-registered offshore affiliate of Kazkommertsbank (KKB) Kazakhstan's leading banking group.

In 1999 the company was forced into receivership and almost broken up.

The company was saved by Bernard Isautier, a board member who had long been involved in the Canadian oil industry and in Central Asia. He became CEO and negotiated a merger with CAIH.

From mid-Oct 1999 to 2000 Hurricane acquired 88.4% of OJSC Shymkentnefteorgsintez (now PetroKazakhstan Oil Products LLP) which owns the 160,000 bpd Shymkent Oil Refinery, the most modern of the country's three refineries (commissioned 1985).

CAIH ended up w/ 30% of Hurricane's stock. This eventually made the investors in both companies very wealthy, especially Isautier who was paid in stock options. The rapid increase in the stock's value made Isautier by far the most generously compensated exec in Canada in 2004

In 2003 Hurricane was renamed PetroKazakhstan to reflect that its entire operations are in that country.

On 21 Aug 2005 China National Petroleum Corporation (CNPC), agreed to buy the company for US$4.18B via CNPC International Ltd. (CNPCI), a 100% subsidiary of

China National Oil & Gas Exploration and Development Corp. (CNODC). This made the PetroKazakhstan deal the largest overseas acquisition by a Chinese company.

In 2006 it was transferred to PetroChina

23 Aug 2005

Arriving at an opportune moment, Bernard Isautier bought the refinery involved in the dispute, paying in stock. Unfavorable deals with the Kazakh government were resolved. He recapitalized the company w/ money from European investors.

nytimes.com/2005/08/23/bus…

Though the company is officially based in Calgary, Mr. Isautier runs it from London and has moved its top executives there. With all its assets in Kazakhstan, the oil producer today has few ties to its ostensible base.

After eight years with the Ministry of Industry in France, Isautier moved to Elf Aquitaine, an oil and gas producer owned at the time by the French government. His connection to Canada began then. In the mid-1970's, Mr. Isautier was sent overseas to run Elf's Canadian subsidiary.

From 1990 to 1992, he was president and chief executive of Thomson Consumer Electronics in Paris. The company, then owned by the French government, markets products under the RCA and G.E. brands in the United States.

"It was a spectacular set of oil fields that was the attraction for him," Mr. Auld said from London yesterday. Mr. Isautier also thought that political changes in Kazakhstan would bring order to the business climate there, Mr. Auld recalled.

But the company still finds itself embroiled in disputes with the Kazakh government. To help ease those problems, PetroKazakhstan hired the former Canadian prime minister, Jean Chrétien, as a special adviser last year, with limited effect.