"Azerbaijan and Kazakhstan can be considered as suppliers" - what is the prospect of the Kulevo Oil Refinery?

"Georgian Dream" announced another project before the elections. It’s the Kulev oil refinery that had be pledged to be built 12 years ago. The construction of an oil refinery in Kulevi FIZ has been planned since 2012, "Black Sea Petroleum" LLC is the third investor in the project that is set to pour $30 million in the project. 

At the presentation held on October 22, the founder of Black Sea Petroleum Maka Asatiani said that the Kulevi oil refinery project  aims to strengthen Georgia’s development and ensure the country’s energy security .

The ruling party evaluates the project as "the largest private investment project" in the history of independent Georgia. The amounts of money are really colossal — at the first stage $110 million will be allocated, the investment cost of the project is $700 million.

The raw materials will be delivered to Kulevi by rail, which will also increase the costs.

Energy expert Gia Arabidze shares the opinion that the Kulevi Oil Refinery will ensure the country's energy stability. In his words, the cost of transportation is negligible compared to the benefits that the Kulevo plant can bring.

"For improving national energy security, one of the main directions is creation of strategic reserves  for gas and oil products. Georgia should build oil refineries for this purpose as well. This is a very important project, because the transit price for transporting oil is very insignificant compared to what the oil refinery construction will bring, I mean investments, employment, and most importantly, the country will be able to satisfy domestic demand for petroleum products," says the energy expert.

Arabidze sees Kazakhstan as a possible partner, as it is trying to reduce oil transportation in the direction of Russia but  does not rule out cooperation with Azerbaijan.

"Kazakhstan has already begun transporting its oil in our direction. Kazakh oil is already passing through Georgia via the Baku-Tbilisi-Ceyhan pipeline. Energy security is a guarantee that the Kuleva point will give us.

We can consider both Azerbaijan and Kazakhstan as supplier as Kazakhstan has cut oil transportation to Europe via Russia to a minimum  that gave rise to the possibility of building such plants in our country,” Gia Arabidze points out.

Note: "Black Sea Petroleum" was founded in October 2022. 70% of the shares belong to businesswoman Maka Asatiani, 30% - to TRADE STONE IBERIA LLC.