Preparatory work to introduce Open Joint-Stock Company (OJSC) Azot (formerly TojikAzot) is under personal control of the President and the Prime Minister, Qurbon Hakimozda, the Governor of Khatlon Province noted on January 29 while addressing a meeting of regional administrators in Bokhtar.
According to him, the plant will be reintroduced into operation this year. “About 500 specialists are preparing the enterprise for launching. Construction of gas pipeline to the plant has been completed and it is already receiving gas,” the governor said.
“To-date, the enterprise has repaid 15 million somonis of its tax debts and most of wage and electricity arrears major part,” Deputy Mayor of Levakant, Nematullo Kabirzoda, told Asia-Plus in an interview.
“The enterprise’s total tax, wage and electricity arrears have amounted to 28 million somonis. The new owner took over the repayment of all debts. Total wage arrears have amounted to 6 million somonis. To-date, they have repaid 4.8 million somonis of wage arrears. They promised to repay the rest within two months,” Kabirzoda noted.
Current average price for a 50-kilogram sack of carbamide (urea) in Tajikistan is 420 somonis.
Meanwhile, Levakant Mayor, Ms. Zarrina Davlatzoda, told reporters in Levakant on July 26 last year that Osiyo Chemical Company, which is the new owner of Open Joint-Stock Company (OJSC) Azot (formerly TojikAzot), has paid the fertilizer plant’s wage debts in the amount of more than one million somonis to date.
“Osiyo Chemical has already launched reconstruction at the enterprise and begun preparations for re-introducing it into operation. The company has already repaid more than one million somonis of the enterprise’s wage debts (total wage debts of Azot amount to 6 million somonis),” said Ms. Davlatzoda. “The company has also repaid Azot’s tax debts in the amount of 15 million somonis.”
According to her, 200 workers have already returned to the plant. “The enterprise will be re-introduced into operation next year and more than 1,000 people will work with it,” the mayor noted.
The debt-ridden and loss-making fertilizer plant has not been in operation since 2008 due to lack of natural gas supplies.
Until 2008, when neighboring Uzbekistan upped the price of natural gas, a key input for the factory, TojikAzot served as a foreign investment-success story for Tajikistan’s economy.
TojikAzot was partly state owned, with the government controlling a 20 percent stake in the troubled enterprise. Ostark Ventures Limited (Ukrainian oligarch Dmitry Firtash is beneficial owner of Ostark Ventures Limited) assumed the 75% ownership interest in the enterprise and Khairullo Saidov, the son of ex-Minister of Industry Zayd Saidov, owned 5 percent of shares in TojikAzot.
On June 24, 2014, the Khatlon Economic Court invalidated the transaction for the sale of TojikAzot.
Tajikistan’s Agency for State Financial Control and Combating Corruption in March 2014 announced an investigation into a 2002 deal between Dmitry Firtash and the Tajik government to create TojikAzot, a plant specializing in the production of urea, an organic compound used in fertilizer. The anticorruption agency accused Firtash of illegal privatization of the company in 2002 and misappropriation of funds.
Firtash was arrested in Vienna on March 12, 2014, and released on a 125 million Euro bail two days later
Following Firtash’s arrest, Tajikistan’s anticorruption agency charged him on March 15 with the illegal privatization of the clothing factory Guliston in 2002.
The anticorruption agency has argued that Zayd Saidov was involved in the fraudulent privatization of Guliston and TojikAzot.
On December 14, 2016, the Majlisi Namoyandagon (Tajikistan’s lower house of parliament) voted for ratification of an investment agreement signed between the Government of Tajikistan and China’s Henan Zhongya Holding Group on September 3, 2016.
Under this agreement, the Chinese company owned 50%+1 shares of the enterprise for the first ten years and then it was supposed to transfer this package of shares to Tajikistan.
Henan Zhongya Holding Group had been committed to invest US$360 million in modernization of coal-powered technological equipment and construction of new shops for production of urea and ammonia in Tajikistan within the next three years. However, the construction works have not been begun.
In August 2019, Tajikistan formally revoked a contract with Henan Zhongya Holding Group, accusing it of failing to fulfill the contract and a full package of shares of OJSC Azot was put out to an investment tender.
The State Committee on Investment and State-owned Property Management (GosKomInvest) said in June 2019 that 350 million U.S. dollars are needed for modernization of this plant. The modernization of the enterprise is expected to increase its annual capacity to 1.6 million tons and the enterprise will be able to export up to 1.3 million tons of mineral fertilizers to the neighboring countries per year.
Tajikistan’s current requirements in mineral fertilizers are reportedly 180,000 tons.
