Bloomberg News

Protesters Rally in Kazakh Oil Region After Riots Leave 14 Dead

December 20, 2011

Dec. 19 (Bloomberg) -- Oil workers in western Kazakhstan protested violence that erupted on the country’s independence day, killing 14 and leaving over 80 wounded.

About 100 oil workers staged a peaceful protest in front of governor’s office today in Aktau, the regional center, said Zhanna Oishibaeva, a spokeswoman for the administration.

Riots in the Mangistau region, bordering the Caspian Sea in western Kazakhstan, have been brought under control, Oishibaeva said by phone.

The violence spread after police fired on oil workers who have been holding strikes since May, Oishibaeva said. Armed “hooligans” attacked civilians and police and burned down city hall, hotels and an administrative building belonging to KazMunaiGas Exploration Production’s Uzenmunaigas unit, Prosecutor General Farhat Daulbayev said in a Dec. 16 statement.

Kazakhstan is the second-biggest oil producer in the former Soviet Union following Russia, with output of about 1.6 million barrels a day, about the same as pre-war Libya.

KazMunaiGas EP, the London-listed unit of Kazakhstan’s national energy company, heightened security at its production facilities, which it said weren’t harmed by the rioting, according to a statement Dec. 16. Company employees didn’t take part in the unrest, it said.

KazMunaiGas EP shares fell as much as 8.8 percent, and traded down 6.2 percent at $13.70 at 3:15 p.m. in London, heading for the biggest decline since Aug. 9.

Output Down

The oil producer has been hit by “illegal labor action” over wages since May, which contributed to a 7 percent decline in oil output in January through September from a year earlier, the company said last month. KazMunaiGas EP fired about 1,300 workers involved in the protests at two units in Mangistau, its biggest oil-production region, the company said in August.

Output may be affected as communications from the area have been limited after the violence, JBC Energy GmbH said in an e- mailed statement.

“This development is the latest in a series of supply disruptions over 2011, which have considerably contributed to triple-digit crude prices,” JBC Energy GmbH said.

Prime Minister Karim Masimov formed a government commission to investigate the reasons behind the riots and establish the amount of damage caused, according to an e-mailed statement today from his office.

No crimes or curfew violations were reported last night in the town of Zhanaozen, where the protests were centered, the Kazakh Prosecutor’s General Office said in an e-mailed statement today from Astana. The prosecutor’s office published a list of 11 people killed and said three others hadn’t been identified.

--Editors: Torrey Clark, Alex Devine

To contact the reporter on this story: Jake Rudnitsky in Moscow at jrudnitsky@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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