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Georgian Railways

Georgia to Earn Yearly 60 million GEL from Turkmen Oil Transit

Under Georgia-Turkmenistan agreement, for 3 years Georgian corridor will handle 4.5 million tons of Turkish oil and state budget will receive yearly 60 million GEL.

The Georgian Party obtained this rights after Caspian Transport company won the tender. Caspian Transit director general Rati Ghvaberia noted that Dragon Oil company, which trades in Turkmen oil had announced tender. About 25 companies were taking part in the tender, including serious competitors such  as Witol Trafigura and Enoch.

“Our consortium has persuaded Turkmen Party that we are able to transport this cargo through Georgian corridor and will ensure its safe delivery to Batumi terminal and their supply to various international companies”, Ghvaberia said.

This is an unprecedented event. The agreement came into force on January 1 and cargo transportation by ships will start on January 14. “Our consortium owns about 37 ships. Two terminals serve in Kaspi and we implement these operations through these resources”, Ghvaberia said.

The 2016 practice has proved that we are able to serve this volume of cargo. The company plans to increase this volume further, he added.

As reported, under the agreement with Turkmenistan, 1.5 million tons of Turkmen oil will be transported through Georgian corridor every year. Georgia’s yearly revenues will be about 60 million GEL.  Agreement with Turkmenistan proves the confidence towards our country, David Chivadze, head of GR Transit company, a subsidiary of Georgian Railway, noted. Previously, it was very difficult to sign similar agreements, he added.

“This is a genuinely unprecedented agreement. The 3-year contract signifies stability in our country and confidence in Georgian Railway. Naturally, it was difficult to sign such an agreement. Both government and Georgian railway management have provided active job to direct cargo to Georgia. Good conditions and valuable operation of Georgian Railway created our advantage”, Chivadze said.

Such major cargo consignments will attract additional smaller volume of cargoes, he added.

As reported, in 2007-2008, about 600 000 tons of oil was transported through Georgia. After August 2008 developments, cargo was redirected to Novorosiisk seaport through Makhachkala.

Starting 2013 Georgian Railway management was conducting active negotiations for attracting Turkmen oil and oil products to the Georgian corridor.

«After 7 years, Turkmen cargo has returned to Georgian corridor. After the first successful consignment in 2015, Georgian corridor handled  1.3 tons of Turkmen oil  in 2016. According to the achieved 3-year agreement, Georgian Railway corridor will handle 1.5 million tons of oil and oil products every year», Georgian Railway representatives noted.