Origins
Tamaz Somkhishvili was born in 1957 as the second son of Valerian Somkhishvili and Lili Melikishvili, with his family roots deeply embedded in Georgia. In 1935, his grandfather Amiran constructed the family residence in Tbilisi. However, as the family expanded, Amiran opted to relocate to a larger home to accommodate Valerian and his siblings. Initially, the family’s situation was difficult, but after Valerian married, his grandfather managed to provide two rooms for him, while his brothers shared a room with their parents and sister in another. Tamaz recalled that running water was only introduced to their home when he was six, which was typical for that era.
Valerian, Tamaz’s father, worked as a shoemaker in both Ukraine and Russia, which made his absence challenging for the family. Despite this, he supported them and visited during the New Year and May holidays, while the children had the opportunity to see their father during summer vacations in Russia and Ukraine. Growing up in such tough circumstances instilled in Tamaz the core values of loyalty and honesty towards family and friends. He also inherited a sense of loving kindness from his father and a serious approach to people’s words from his mother.
Education
Tamaz earned his first degree, a bachelor’s in culinary arts, which he completed quickly despite interruptions from his military service. His knowledge of nutrition and the aesthetics of cooking would later benefit his entrepreneurial endeavors. He pursued further studies in physics and mathematics at the Tobolsk Pedagogical Institute but later switched to finance at Tyumen State University. The education he received became crucial for his future business ventures, culminating in a PhD on “The Conditions and Sources of Financing Investment for the Development of the Oil Industry,” which he successfully defended in 2002 at the National Academy of Economics and Public Administration under the President of the Russian Federation in Moscow.
Compulsory Military Service
In 1975, while still attending culinary school, Tamaz was drafted for military service. Fortunately, he served alongside his older brother Jemal, completing basic training at an artillery boot camp in Chernovtsy, Ukraine. Due to his proficiency in the martial art of sambo, in which he had won competitions, Tamaz was assigned to the sports company of his unit. However, he chose to remain with his brother and later led a squad under Jemal’s platoon command in Czechoslovakia. Despite being offered a position in the officers’ mess due to his culinary background, Tamaz firmly declined, stating, “I’m here to serve in the army, not to cook.” He completed his military service at a training facility, gaining local recognition through newspaper coverage of his shooting activities. After two years in the military, Tamaz emerged with numerous new skills and a newfound self-confidence and independence that would greatly benefit him in his business career.
Early Career
After receiving a recommendation from the director of his culinary college, Tamaz Somkhishvili chose to join a Komsomol building project in the Tyumen region of Siberia. In this role, he was tasked with procuring essential supplies, including food and clothing, for the workers involved in the Urengoy-Pomary-Uzhgorod gas pipeline project, commonly known as the Trans-Siberian pipeline. In 1978, Tamaz faced a new career challenge when he was assigned to the remote taiga forest of Tyumen at the Demyanskoe station, where he worked on the pipeline construction to Chebutan alongside a former classmate, Givi Guishvili. Initially serving as a labor recruitment officer, he was quickly promoted to director. Due to the challenges of sourcing supplies in such a remote area, Tamaz had to fly weekly by helicopter to Tobolsk to find and purchase materials, building equipment, and hardware for the pipeline crews. This experience enabled him to establish crucial supply networks that would benefit him in future larger projects. The Trans-Siberian project faced extreme weather conditions, particularly harsh winters with temperatures plummeting below minus 40 degrees. After enduring these severe conditions for some time, he and his friend Beridko Tavshavadze became the last two members of the original team. Eventually, they relocated to Tobolsk in search of better opportunities. Tamaz was fortunate to secure a position as the manager of a local restaurant, which opened doors to valuable connections, including Alexander Sheller, the manager of a well-known restaurant called Vstrecha. In 1981, Tamaz and Alexander launched a drinking establishment, which eventually led Tamaz to manage a renowned restaurant named Druzhba.
1980: Olympic Shirts
During the late Soviet era, making money was still a challenge, but Tamaz’s entrepreneurial instincts helped him identify a lucrative opportunity with the upcoming Moscow Olympics. As excitement for the games grew, the Soviet Union was filled with promotional images and Olympic symbols. With his keen eye for fashion, Tamaz conceived the idea of producing T-shirts featuring the Olympic emblem. However, he faced a hurdle: he needed to secure a patent for the production process before starting. Utilizing a friend whose father had served in World War II, Tamaz managed to have him apply for the patent. Once the patent was obtained, Tamaz hired tailors, sewers, and designers, installed overlock sewing machines, and sourced stylish fabric from Moscow. The project turned out to be immensely popular, yielding a substantial return on investment for Tamaz.
Motor Vehicle Collision
Despite being a skilled driver and car enthusiast, Tamaz was involved in a serious car accident in 1984 while returning from a visit with his father in Tyumen. As he sped around a corner in the rain, his brand-new Zhiguli hit a large pothole, causing it to collide with an oncoming truck. The accident resulted in several injured cervical vertebrae, necessitating a hospital stay for recovery. However, due to his physical fitness and athletic nature, Tamaz healed more quickly than anticipated.
Late Soviet Era Restructuring: More Opportunities
By the late 1980s, Soviet economic policies had introduced reforms that allowed for the establishment of cooperative businesses. After being invited by the Tobolsk City Executive to create a cooperative, Tamaz founded the Kolkhida trading and restaurant business. Leveraging his culinary knowledge and financial acumen, he set about hiring a fleet of trucks and managing logistics for fresh produce deliveries from regions like Siberia and the Central Asian republics. In Tyumen, he opened the popular Druzhba restaurant, which he kept well-stocked with produce, leading to its success as a dining venue. However, Tamaz was not content with the returns from the restaurant business. Recognizing its limitations, he decided to transform Druzhba into a pastry production facility and retail shop, specializing in the region’s beloved ‘Ptichye Moloko’ (Bird’s Milk) cake. Believing this venture would be more profitable, he sought to acquire the raw materials necessary for large-scale production, including sugar, butter, and eggs, which were often in short supply during the Soviet era. With his family in mind, he enlisted his brother Anzor to manage the facility.
Establishing a large bakery required a significant supply of sugar, which was difficult to find at the time. Tamaz understood he needed to negotiate with several sugar factories across Ukraine, but first, he had to obtain permission from the Tyumen Trade Administration to proceed. After successfully negotiating and securing the necessary approvals, Tamaz located and purchased 5,000 tons of sugar from Ukraine, which then had to be transported to Tyumen. Through these efforts and his sharp business acumen in sourcing materials for a large operation, Tamaz developed the Druzhba cooperative’s Ptichye Moloko production facility into a popular shop that generated a healthy profit for his endeavors
Oil Sector
During the late Soviet era, the infrastructure for oil production was still under development. In 1991, after a meeting with Viktor Dolgov, the Deputy President of Lukoil Company, an opportunity emerged in Tyumen with the establishment of a Lukoil branch, a company focused on oil refining and retail gas stations. Consequently, Tamaz registered a joint venture project called CJSC ‘Lukoil S’ (Lukoil Service), which included several mobile petrol stations. As both part owner and director of the company, Tamaz oversaw not only the gas stations but also the Perm Oil Refinery. This successful venture led to the creation of another business, ‘Lukoil Market,’ which supplied petroleum products, merchandise, and food imported from Western European countries like France and Germany to cities in the region, including Langepas, Uray, and Kogalym
Refineries and Export
By 1994, Tamaz found a new business opportunity with Rosnefteexport CJSC, in which he acquired a 15% stake, while Rosneft held 50% and Lukoil the remaining 35%. As a refining and exporting company, Rosnefteexport operated crude oil refineries in Mozyr and Novopolotsk in Belarus. The resulting petroleum products were sold in both Russian and European markets through trading firms such as Vitol and Glencore. Within a year of becoming the director of Rosnefteexport CJSC, Tamaz realized that Rosneft, which owned a 50% stake, was not contributing as anticipated. As a result, he acquired Rosneft’s share, ultimately controlling an 85% stake in the company, which had expanded to include refineries in Omsk, Perm, and other locations in Belarus.
Oil for Debt: Rosnefteexport as Debt Instrument
As Rosnefteexport thrived, Tamaz identified a solution to a significant problem stemming from the challenging economic conditions of the early post-Soviet era. Many companies, both large and small, particularly in the energy, gas, and transport sectors, were accumulating unmanageable debts due to inadequate capital investments and insufficient revenues. Drawing on his finance background, Tamaz devised a debt-purchase arrangement that became popular among cash-strapped businesses. He began acquiring the debts of oil producers owed to energy producers at discounts of up to 18%. Starting with large companies like Lukoil, he then moved on to acquire Nizhnevartovskneftegaz’s energy debts owed to Tyumenenergo, and subsequently purchased the debts of Tyumenenergo owed for gas consumed by Surgut GRES. This arrangement allowed Lukoil to offset its electricity costs through oil installments of up to a quarter million tons per month. With the success of this scheme and the substantial profits generated, Tamaz continued to acquire significant stakes in the Odessa Oil Refining Plant from the owner of Synthesis Company, further increasing the export capacity of his oil refineries to both domestic and international markets.
From Oil Refining to Oil Production
With the refining and export businesses flourishing, Tamaz decided to broaden his interests in the oil sector to include exploration and production by the end of the 1990s. Although this was a new area for him, it held the potential for greater profitability, albeit with increased challenges compared to his previous ventures. Leveraging his extensive network of contacts in the oil industry, Tamaz assembled a team of experts, including geologists, mechanics, and engineers, to embark on this new business endeavor. However, the technical challenges of the project necessitated forming broader alliances, prompting Tamaz to collaborate with specialists from an American joint venture, Polar Dawn, as well as a director from Megionneftegaz and experienced technical personnel from Tobolsk Oil and Chemical to assist with infrastructure construction, exploration, and extraction of oil reserves in Siberia. Success came swiftly, beginning in the Tomsk region, where Tomsk Oil discovered 16 million tons of oil and 11 billion cubic meters of gas. This project required substantial investment in ground facilities and pipeline technologies in the remote Siberian taiga, including 17 wells, a power station, and a 70 km pipeline. Transporting materials for such a large-scale operation necessitated the seasonal use of barges on the Ob River. Despite the complexities and challenges of oil extraction in such a remote location, the dedicated team of around 50 workers effectively established an exploration and production operation.
Exploration Beyond Tomsk
Tamaz next set his sights on finding new oil fields to develop with surveys in the Nenets Autonomous district of Arkhangelsk on lands licensed to Danao Engineering. Here, a major discovery of reserves with a 5-7 times faster flow-rate than the Tomsk wells was secured. Development of this new discovery was onerous however, as the permafrost of the northerly region required surface-only pipelines. But with reserves of 35 m tons compared to the 30 m tons of the Tomsk wells, this was undoubtedly a huge triumph.
Oil Production and the Environment
In 2004, the British investor set his attention to some of the sources of pollution resulting from the oil extraction process. So-call associated petroleum gas (APG) – a form of natural gas found with oil deposits which usually escapes and is flared off during the oil pumping process – occupied Tamaz’ mind. Again, with his keen business sense and seeing a wasted potential energy source, Tamaz arrived at the idea of an electricity generating facility with pistons powered by APG. As a result, in 2004 he built plants on Lukoil’s fields to supply oil companies with much needed electricity. One such generating facility, using Jenbacher (GE) gas piston technology, supplied 36 megawatts of power after one year of operations.
Tamaz was the first in Russia to come to an agreement with the World Bank under Kristalina Georgieva (currently director of the IMF), which would see his idea to reduce a potent greenhouse gas during oil production implemented and thus, conform to the requirements of the Kyoto Protocol to reduce one of the sources of global warming.
Moscow Residential Project
Tamaz was occupied from 2008 to 2010 with work building the Moscow government commissioned joint residential and business complex known as Family House. Once the massive 29,000 square meter complex was completed his interests in Russia ended.
Aviation Industry in Georgia
Now a British citizen and investor (2007), Tamaz focused on the airplane maintenance sector so he founded Airplane Technics, with Vincent Morelli, from Lufthansa Technik, as Chief Manager. Shortly thereafter, an airplane maintenance facility opened at Tbilisi Airport, servicing the many civilian Boeing and Airbus aircraft landing there.
Following from his interest in aviation and airplane maintenance, Tamaz next founded the Aviation College to provide the opportunity to young people in Georgia to study in an international educational institute leading to professional certification in aircraft maintenance. The college provided a joint training program, based in Tbilisi, with the Istituto Scolastico San Carlo, a European Aviation Safety Agency recognized school in Verona, Italy. Participating students pursued courses in a variety of European countries including Germany, Turkiye, Switzerland and Italy and Dubai.
Unfortunately, as a result of the cessation of airflight and reorganization of the industry during the Covid pandemic, the company’s business was negatively affected by the losses affecting the whole airline industry since 2020.
Ongoing Investment Interests
Tamaz’s current business pursuits include metallurgy research (ferrochrome) as well as projects in innovative technologies and telecommunications.
Philanthropy
Tamaz is one of the largest donors to St. Andrews University of Georgia of the Patriarchate of Georgia in addition to purchasing the Georgian Orthodox Church in London in 2009.
Sports Enthusiast
Tamaz Somkhishvili has long been passionate about sport shooting, a pursuit that has played a significant role in his life. His dedication to the sport led him to serve as the president of the National Federation of Sport Shooting of Georgia from 2017 to 2021, where he actively contributed his expertise and time to promote and develop shooting sports in the country. In Georgia, shooting, alongside martial arts, is a source of national pride, especially in international competitions such as the Olympics, where athletes represent their country on a global stage. Recognizing the need for high-quality training facilities, Tamaz took the initiative to establish a state-of-the-art shooting club in Tbilisi that meets European standards. This facility is equipped with modern shooting ranges and armories, providing serious athletes with the resources they need to hone their skills and compete at higher levels.
Pastimes
From a young age, Tamaz has had a deep-seated love for sport pistol and rifle shooting, which has remained a consistent interest throughout his life. In addition to shooting, he has also excelled in martial arts, becoming an expert practitioner of sambo and judo. His commitment to physical fitness and competitive sports extends to tennis, a sport he enjoys playing regularly. Tamaz’s diverse interests in various sports not only reflect his dedication to personal fitness but also his desire to foster a culture of athleticism and competition in Georgia.