Protests, Toxic Waste and Ablyazov: What's Going on with MAEK?

Employees of the Mangystau Nuclear Power Plant (MAEK) recently recorded a video message to the president. They called on the management to terminate the contract with contractors who, allegedly due to their inexperience, inhibit the enterprise. An accident occurred at the plant before this. residents of the Aktau and Mangystau regions were left without electricity and hot water as a result. But these are not the enterprise's only problems. Orda.kz looked into the situation.

The accident at the MAEK occurred on the evening of April 16. The enterprise's workers later appealed to the president. There was no hesitation in the management's reaction. The press service of the plant stated that unverified and unreliable information concerning the repair work was in the video message.

"The administration of the plant together with the akimat of the region are doing everything possible to finance and support the work of the plant. Unreliable information distributed on social networks creates a strained atmosphere, which negatively affects the work of the energy complex,"

the press service of the combine quotes Kalizhan Kabdulov, Deputy chief engineer of MAEK LLP's repair plant.

A commission launched by Gosenergonadzor has been to MAEK. They have been investigating the supposed technological violation in accordance with Kazakhstan's legislation.

Even the fugitive Kazakh banker and oppositionist Mukhtar Ablyazov noticed the situation developing around MAEK.

On April 21, a video message addressed to President Toqayev surfaced on Ablyazov's official TikTok account. The ex-banker stated that he was ready to manage MAEK. Remotely.

He has also promised to increase the wages of workers from 500 thousand to 3 million KZT and contribute significant taxes to the country's budget. Ablyazov claims that repairs would be carried out as soon as possible with no government support.

He offered all this against the background of the MAEK employees' allegedly planned strike.

Wear and Tear, Deception, and Protests

On May 1, 2003, MAEK-Kazatomprom LLP, a 100% subsidiary of the National Atomic Company Kazatomprom, became the owner and operator of the MAEK energy complex.

MAEK-Kazatomprom is the main regional supplier of both heat and electricity along with fresh water. The company was initially registered in 2003. And the latest re–registration was in December 2022. Presumably, this is due to the fact that in November 2022, by presidential decree, the power plant was transferred to the municipal property of the Mangystau region for modernization.

Zhasulan Suyunchaliyev became the first head of the enterprise in the same year. He previously held the position of director of the State Enterprise "Kaspiy zhylu, su Arnasy". MAEK's staff is about 3.6 thousand people.

It is not the first time that dissatisfied workers from MAEK have addressed the president. In November 2022, the workers made a direct appeal to Toqayev. They spoke about rapidly growing inflation devaluing their salary, which, according to them, was only 140-160 thousand tenge. After long protests, employees of the Mangystau Nuclear Power Plant "Kazatomprom" were promised a salary increase of 30%. The company's management later stated that it could not fulfil the employees' demands due to debts (9.7 billion KZT).

Local Mangystau media have repeatedly reported that MAEK-Kazatomprom, being a natural monopoly entity, increased tariffs for electricity and hot water. Residents had no choice but to pay.

In 2022, the Department of the Committee for Regulation of Natural Monopolies revealed that MAEK-Kazatomprom illegally charged consumers for hot water. The company was fined and ordered to return about 70 million KZT to consumers.

Mukhtar Ablyazov published a photo on his Facebook page. It is supposedly the worn-out equipment of the Mangystau Nuclear Power Plant.

Toqayev, at a meeting with residents of the Mangystau region last year, emphasized the need to modernize MAEK. The main power equipment at the plant was put into operation in the early 60s. Its physical wear is currently 80.7 percent.

Toxic Waste

The BN—350 reactor was MAEK's main object. It was designed to generate electricity, desalinate seawater, and accumulate plutonium-239. It was also the world's first pilot-industrial fast neutron reactor with a sodium coolant.

In 1999, the Government of Kazakhstan issued a decree on the shutdown and decommissioning of the reactor. the media referred to BN-350's ability to produce weapons-grade plutonium as the reason. Kazakhstan had also put forward a number of anti-nuclear initiatives at the time.

However, according to Artur Shahnazaryan, an expert in the field of oil and gas, there was a different reason.

"It was impossible to continue working with this installation without close cooperation with Russia. And in Russia, in those years, there was a peak of political and economic crises. In addition, the United States insisted on stopping BN-350. By the way, the Americans paid for all the work on the removal of plutonium from the station. It was transported to the Semipalatinsk test site,"

All work on the reactor was strictly classified in Soviet times. And the city of Shevchenko (now Aktau) was closed off. Despite the fact that nuclear fuel was removed from MAEK at the time, toxic waste remains.

"Waste is now stored 5 km from Aktau, and 8 km from the Caspian Sea in the Koshkar-Ata tailings pond. The lake area is 50 square meters. Periodically, the tailing pond is being supplemented at the present time with new waste already from the oil industry,"

Artur Shahnazaryan said.

About 10 years ago, according to the expert, the Akimat of the Mangystau region conducted research and compiled design and estimate documentation for the tailings pond's remediation.

In September 2021, Qasym-Jomart Toqayev personally instructed the government and the region's akimat to complete remediation within three years. The project was suspended this year. Officials say that the funds invested in the project back in 2015 are barely enough to clean up one-third of the area.

According to experts from the Mangystau Region's Department of Natural Resources and Environmental Management, due to rising prices for services and inflationary expectations, the amount of the project will have to increase.

"Due to inflation, the amount of 15.5 billion tenge is insufficient for the development of 4,200 hectares. We are waiting for what the state expertise will say in order to finance the development of design and estimate documentation,"

says Deputy Head of the Department Esenkos Adilbayev.

Doubling the budget is in the crosshairs. It is unclear whether the government will approve this. This uncertainty extends to whether or not work on the lake's detoxification will be resumed in the near future.

"National Companies Are The Foundation of Corruption"

Orda spoke with the former Kazatomprom head, Mukhtar Dzakishev, to find out if Ablyazov could deal with all the aforementioned problems and solve them in the promised six-month period.

Mukhtar believes that the efficiency of any company can be improved, even such a deplorable one as MAEK.

"If Ablyazov says something, he most likely calculated everything there and believes that he will improve the state of the enterprise. After all, the efficiency of any company can be improved if they do not steal there and manage money normally. Almost all state-owned companies do not comply with these two rules. I haven't seen any effective national companies yet. However, I cannot say how much Ablyazov would optimize the processes in the enterprise, what his calculations are and how he's taking his bearings,"

Dzhakishev replied.

Mukhtar Dzhakishev knows firsthand about the management of inefficient companies. In September 1998, he received an offer to transfer to Kazatomprom. In an interview with Forbes, Dzhakishev admitted that in those years "the situation was the most difficult". Shortage of personnel and specialists, multimillion-dollar loans and bleak reports. Dzhakishev still managed to turn Kazatomprom from a loss-making enterprise into a world leader in the extraction of natural uranium.

"Positive changes could be noticed already in 2004. They were substantial. The indicators for salaries, social services, and equipment repair had been improved. At the same time, we did not raise tariffs, but on the contrary, we lowered them,"

says the former head of the enterprise.

Despite the fact that Kazatomprom, which was headed by Dzhakishev, is itself a national company, the former head of the company strongly opposes nationalization.

"Any company has a safety margin and reserves, they are simply not used. If you go there, you can find them, pull them and direct them for good (use - Ed.). There is an absolutely clear list of activities for the effective operation of a company. But no one uses them. Because national companies are the foundation of corruption. State-owned companies manage other people's money, and the management will always want pocket a part (of it - Ed.). We need to get rid of state property. Because the appointed person does not own the enterprise, but at the same time manages its resources."

RMB: Mukhtar Dzhakishev headed the national nuclear company for more than 10 years. In 2009, he was detained by the KNB, and three days later he was put under arrested, accused of embezzlement, embezzlement of state property and damage to the uranium industry. The court, which was held behind closed doors, sentenced Dzhakishev to 14 years of imprisonment in a high-security colony. Human rights activists and his supporters call his arrest politically motivated. He was released on parole only in March 2020.

"So What Do We Lose?"

Two camps came to be after Ablyazov's appeal. Some said that the banker was trying to turn the plant into an instrument for political blackmail. Others noticed his patriotism. However, Mukhtar Dzhakishev believes protests are the what really interest Ablyazov:

"His interest is caused by the fact that all protest events are taking place in the West right now. He wants to show that even the reserves available in the enterprise can be effectively managed. I absolutely agree with this. Over the past 10 years, our management level has fallen below the baseboard. And as a manager, he is, in any case, strong. No one disputes this here."

According to Dzhakishev, Kazakhstan won't lose anything from this proposal but doubts that this can be done remotely.

"The question arises, what do we lose then? Let's let him be in management, let him improve its work there. (If - Ed.) he will pull it off – well done, if he does not – it's worse for him. The authorities, on the contrary, will score points, say, here, he was all talk, but he didn't change anything. Of course, I am confused only by the remoteness of the whole thing. It is very difficult, almost impossible, to remotely manage an entire enterprise."

Ablyazov's offer has thus far gone unnoticed. This is unlikely to change.

Original Author: Silam Aqbota

DISCLAIMER: This is a translated piece. The text has been modified, the content is the same. The article has been updated as of 2/05/2023. Please refer to the original article in Russian for accuracy.