Head of Ministry of Finance - KTZH may become shareholder in Doszhan Temir Zholy JSC

/INTERFAX-KAZAKHSTAN, Astana, October 20, 08/ - The national railway company, Kazakhstan Temir Zholy "(KTZH) may become a shareholder of Doszhan Temir Zholy JSC, the concessionaire's project to build a railway line Shar (Charsk) - Ust-Kamenogorsk in East Kazakhstan region (EKR), the Minister of Finance Bolat Zhamishev informed. "We solve the issue on attracting (Doszhan Temir Zholy - IF-K) KTZH as a shareholder because the current shareholders of the company did not provide the necessary level of capitalization," - he said to journalists on Monday in Astana. In addition, according to the head of the Ministry of Finance, today the Ministry of Economy determines the final cost of the project to build this railway line. "The government will get the facility and give a bail in an amount equal to the cost of the project. Today the cost of the project is determined, the amount of the bail would be raised", - said B. Zhamishev. In this regard, he stressed that all obligations of the company "will be implemented, as the economy as a whole, is stable." It was reported that construction of the road started August 27, 2005 after signing of an agreement between the Ministry of Transport and Communication and Doszhan Temir Zholy JSC, acting as a concessionaire of the project. Construction took place on both terminal stations to meet each other, and in December 2007 the ways were connected at the station Ekasha. Originally it was planned that the road will be built and put into operation by December 2008, but later it was decided to accelerate the work. The Shar - Ust-Kamenogorsk line directly linked the east of Kazakhstan with its center passing the 82-km transit through the territory of Russia, and reduced the current route between the stations by 311 km. Commissioning of the new railway line can reduce the distance and timing of transportation from industrial organizations of Rudniy Altai to other areas of Kazakhstan as well as reduce transport costs for shippers and increase the volume of passenger transport and tourism services. The project is stipulated by the Kazakhstan strategic development plan before 2010. Construction of the road Shar - Ust-Kamenogorsk - is the first infrastructure project in the country, realized at a concessionary basis. During the operation of the railway line all incoming revenues will be aimed at ensuring the bonds issue, but at the end of the lease term the issuer will be obliged to transfer the object to government property. According to the press service of Akim EKR, the total cost of construction of the Shar - Ust-Kamenogorsk railway exceeds KZT14 bn. (current 119.76/$1). Kazakhstan is currently running a program on creating their own rail network, which will link the various regions of the republic on the best routes, excluding transit through the territory of neighboring countries of the CIS. It was also reported that the government granted company concessionaire with the state bail for infrastructural bonds issue for the project, after which the securities were purchased almost entirely by pension accumulated funds. [2008-10-21]