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US and Kyrgyzstan Wrangling Over Fuel Supply Offer for Access to Manas

As talks to shape Kyrgyzstan’s next government get underway, the United States has fashioned a compromise fuel-supply arrangement that US officials hope will ensure American and NATO access to the Manas transit center outside Bishkek for at least two more years.

The fuel supply arrangement at Manas has been the subject of US-Kyrgyz wrangling in recent months. Kyrgyz officials were pushing for the creation of a Kyrgyz-Russian joint venture to act as the sole fuel supplier. The Pentagon, meanwhile, remained committed to a competitive tender process. The supply issue reportedly was among the topics discussed during a September 24 meeting between US President Barack Obama and Kyrgyz provisional leader Roza Otunbayeva.

The same day as the Obama-Otunbayeva meeting, a US solicitation for Manas jet fuel supplies was amended to give the Defense Logistics Agency (DLA) the ability to grant 20 percent of the contract to a state-owned Kyrgyz enterprise beginning in February 2011. The Kyrgyz entity’s supply share could rise to 50 percent by July 2011.

A contractor of DLA’s choosing would provide the remaining share of the air base’s TS-1 jet fuel needs. The Manas air base is a vital logistics hub for US and NATO military operations in Afghanistan.

Kyrgyzstan’s October 10 parliamentary elections produced no clear winner, meaning complicated talks are needed to produce the country’s next government. Leaders of at least one party set to enter parliament – Ata-Jurt, the leading vote-getter – have hinted that they might consider terminating the US lease at Manas. A Kyrgyz role in fuel-supplies could act as an incentive to keep existing lease terms unchanged.

Sources have confirmed to EurasiaNet.org that the amendment was formulated unilaterally by the US side. Past fuel-supply practices at the base are the subject of both, a US congressional probe and Kyrgyz government investigation.

According to amendment 8 of the solicitation; “The [US] Government intends to award a requirements contract under this solicitation and a second requirements contract through other means. This will likely result in more than one supplier providing fuel to the Manas Transit Center.”

“The Government anticipates that the second contractor will ultimately provide a maximum of 50 percent of all required fuel to [Manas Transit Centre]. This transition schedule is subject to change, and may be delayed or accelerated,” the amendment added.

The solicitation’s time frame also has been revised: the new terms call for the supply of 120 million US gallons of fuel to the base for one year with a one-year option for the same amount. The previous terms called for two guaranteed years of supplies at 120 million gallons per year, along with an additional one-year option.

The amendments were fashioned in a way to allow a Kyrgyz state-owned enterprise to partner with a Russian fuel supplier. That Russian partner is widely expected to be the state-controlled behemoth Gazprom.

Marat Malataev, the deputy director of wholesale fuel sales for Gazprom Neft Asia in Kyrgyzstan, was installed in August as the general manager of the state-owned Manas Refueling Complex, a key fuel facility next to the air base known as Aalam Services before it was nationalized in June by presidential decree, sources added.

Malataev is currently on unpaid leave from Gazprom Neft Asia. He is believed to be an Otunbayeva associate, having served as the as second secretary for trade and economic issues at the Kyrgyz Embassy in London from 1998-2000, a time when Otunbayeva was ambassador to the United Kingdom.

The current fuel supplier to the Manas air base, Mina Corp, an affiliate of Red Star Enterprises, is believed to be a strong contender to re-win the contract. Both companies are involved in the ongoing US congressional investigation into Pentagon contracting practices in Kyrgyzstan.

By. Deirdre Tynan

Originally published by EurasiaNet.org




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