The FINANCIAL — Information about who exactly owns the oil companies in Georgia has been vague for a long time. According to the Public Registry the owners of all oil companies in Georgia are foreign individuals or international companies.
The FINANCIAL — Information about who exactly owns the oil companies in Georgia has been vague for a long time. According to the Public Registry the owners of all oil companies in Georgia are foreign individuals or international companies. In spite of the official information, recently Sun Petroleum Georgia, which is presenting Gulf in Georgia, officially announced that Kezerashvili, former Defence Minister, has sold his shares in the company. The issue is still shrouded in mystery.
The oil industry in Georgia has totally changed over the last eight years. Small and medium companies which were previously dominating disappeared or were taken over by new, growing companies associated with the Government. The sector was not financially transparent unlike the banking sector and was not closely monitored by the media.
“The sector is highly profitable and therefore there is big interest in it from investors,” said Irakli Lekvinadze, Managing Partner at Georgian Business and Political Insight. “The majority of companies are created by foreign capital or foreign-registered companies own them. Regardless of this, there are definitely Georgian partners.”
“The Georgian partners of oil companies are mainly registered offshore. This is quite strange how businessmen are avoiding being officially linked to the companies. But if we look through the conjuncture of this business over the last several years, the reasons may become clearer. The sector has been oligopolistic for the last several years. The Government’s interest in it was huge and political influences in such sectors therefore always exist”.
“I don’t think that this is happening for the purpose of tax avoidance in Georgia. Just that people operating in this business didn’t want to have their names linked to government members,” Lekvinadze explained.
The names of David Kezerashvili, former Minister of Defence, President Saakashvili’s brother and former Parliament member Vano Chkhartisili are especially associated with the oil business in Georgia.
According to the Public Registry, Socar Energy Georgia is owned by three companies. The main shareholder is the State Oil Company of the Azerbaijani Republic (Socar) as it holds 51 percent of Socar Energy Georgia. 24.5 and 24.5 percent owners are Heritage General Traiting FZE in The United Arab Emirates and Intersun Holding FZCO in The United Arab Emirates.
The official webpage of the State Oil Company of the Azerbaijani Republic however, says that Socar owns 51 percent, 24 percent is owned by Petro-Trans FZCO (UAE) and 25 by Ivane Chkhartishvili.
The official webpage of Socar Energy Georgia provides totally different information. According to it Socar’s share in fixed capital amounts to 51 percent and Petro-Trans’ share in fixed capital totals 40 percent. PETRO TRANS FZCO is a United Arab Emirates company in Dubai-Jebel Ali belonging to Trading in Trucks & Cars (for Re-Export only), Auto Spare Parts, Railway Wagons & Spare Parts, Ships & Containers and the Metals industry.
The FINANCIAL has been waiting for Socar Energy Georgia to answer questions on who its shareholders are, but with no answer thus far.
Sun Petroleum Georgia, presenting Gulf in Georgia, is the youngest oil company in the country as it was registered in 2010 and started operating in 2011. Today it owns the biggest chain of filling stations in Georgia.
Sun petroleum Georgia is officially 100 percent owned by Energy Investment Venture Holdings in the USA. The Company Director is Adam Ianiv, from Israel.
At the same time, it was constantly being mentioned how the owner of the company was Davit Kezerashvili. Last year he officially announced that he was one of the owners of Gulf. In November 2012 he sold his shares in the company. As a result, famous businessman Davit Iakobashvili, who is the biggest shareholder of Gulf Georgia, increased his share in the company.
The creation of Wimm-Bill-Dann is also attributed to Iakobashvili. He is one of the shareholders of AFK SISTEMA. Iakobashvili is President of the USA-Russia Business Council.
Gulf Georgia is not the first oil company to be linked to Kezerashvili. His interests in the oil business were connected to the company Uni-Group, which is operating distribution of Lukoil fuel. Kezerashvili was its co-founder.
Lukoil Georgia is owned by Lukoil Europe Holdings B.V. registered in the Netherlands. Director of the company is Zaza Katamadze. The company has experienced reorganization three times when the companies Mtskheta Oilproducts, Lukoil Gruzia and Kavta were all merged with Lukoil Georgia.
Shalva Mishveladze, Deputy Director of Lukoil, confirmed the information in interview with The FINANCIAL, that all of the company’s shareholders are non-residents of Georgia.
99 percent of Rompetrol Georgia is owned by Rompetrol Group N.V. in the Netherlands. 1 percent is owned by A.L.J. International S.A. in Panama. The company was reorganized two times when the companies Sharmi and N&N were merged with Rompetrol Georgia.
Rompetrol Group N.V. is operating in twelve countries in total. In 2007, KazMunayGas acquired 75% equity interest in Netherlands-based Rompetrol Group N.V. In June 2009, KMG RM acquired the remaining 25% of Rompetrol, Romania’s 2nd largest oil group. The acquisition of the majority stake in TRG provides KMG with a footprint in important downstream markets in Europe, including France, Romania, Moldova and Bulgaria, as well as the ability to utilize TRG as a platform for future expansion. Currently, KMG participates directly in equity of 33 oil & gas related companies in Kazakhstan and abroad.
It is significant that there is no official information about the shareholders of Wissol Petroleum Georgia on the Public Registry webpage. Official website of Wissol Group says that the company has four shareholders: Samson Pkhakadze, Leval Pkhakadze, foreign partner Wissol Petroleum and the georgian partner Silk Road Group.
Irakli Lekvinadze noted that, as it is known, the Pkhakadze brothers, who are the Chairman of the Wissol Board of Directors and Vice President of Wissol Group respectively, are not owners of the company any longer.
It recently became known that the new government will purchase fuel from three companies in 2013 including Lukoil, Rompetrol and Wissol as a result of the tender. The Government will buy Premium from Lukoil Georgia for GEL 1.84, Super for GEL 1.91 and Diesel for GEL 1.93. Rompetrol and Wissol will be providing Regular to the Government for GEL 1.85. The retail prices of the above-mentioned companies for the same products are 20-30 tetris higher.
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