Kyrgyzstan: Joint Kyrgyz-Russian Venture Now Main Manas Fuel Supplier

In a development that could influence Kyrgyzstan’s willingness to prolong the lease of the Manas Transit Center outside Bishkek, a US Embassy official has confirmed that a joint Kyrgyz-Russian venture is now delivering the majority of fuel consumed at the base.

Kyrgyz President Almazbek Atambayev has indicated on several occasions recently that the Manas facility, a key American-run logistics base for military operations in Afghanistan, might be closed after the planned withdrawal of US and NATO forces in 2014. US strategic planners have yet to make a determination on whether Manas will indeed be needed beyond 2014, provided the withdrawal goes according to plan. But if there is a need, the fact that the joint venture, called Gazpromneft-Aero Kyrgyzstan (GAK), has taken over the lion’s share of fuel deliveries would seem to provide an incentive for Atambayev’s administration to prolong the lease.

GAK -- along with another supplier, World Fuel Services (WFS) -- took over the aviation fuel contract at the US-led air base near Bishkek after the long-time vendors, Red Star Enterprises Ltd and its affiliate Mina Corp, dropped out of the bidding late last year.

Red Star and Mina Corp were alleged to have forged inappropriate links with the Kyrgyz authorities over a number of years. A US congressional report published in late 2010 found no evidence of corruption or wrongdoing, but it did establish that Mina Corp had used fake end-user certificates in order to purchase cheap Russian fuel.

GAK could have started delivering up to 20 percent of the air base’s aviation fuel as earlier as February 2011. But the Kyrgyz-Russian joint venture could get supplies up and running only toward the end of last year.

“Since that time until today, [GAK has] delivered 21,866,293 gallons of TS-1 jet fuel worth approximately $92 million,” said Robin Solomon, a public affairs officer at the US Embassy in Bishkek.

“WFS began delivering fuel in late February 2012. Since that time until today, it has delivered 6,294,369 gallons of TS-1 jet fuel worth approximately $27 million,” Solomon continued. “If you compare deliveries in the month when both companies were delivering fuel for the entire month, the percentage delivered in March was 60 percent from GAK, 7.1 million gallons, and 40 percent from WFS or 4.7 million gallons.”

Under terms of the current contract, GAK can supply up to 90 percent of the Transit Center’s TS-1 fuel, if it can meet demand. In that case, WFS’ portion would decline to 10 percent.