UPDATE 2-Kazakh opposition leader jailed after oil town unrest

* Vladimir Kozlov jailed for seven-and-a-half years

* Judge links defendant with billionaire fugitive Ablyazov

* Oil town riots prompted crackdown on Kazakh opposition

(Adds foreign ministry reaction)

By Dmitry Solovyov

AKTAU, Kazakhstan, Oct 8 (Reuters) - An outspoken critic ofKazakhstan's president was jailed for seven-and-a-half years onMonday for colluding with a fugitive billionaire in a failedattempt to rally oil workers to bring down the government.

Vladimir Kozlov, leader of the unofficial Alga! party, wasfound guilty of orchestrating dissent among striking oilmen inthe prelude to riots last December that killed 15 people anddented Kazakhstan's reputation for stability.

Kozlov denied the charges. In his final pronouncement beforesentencing, he said on Oct. 1 that his case was an "undisguisedattempt" to stifle civic protest and labour rights in the formerSoviet republic.

In more than two decades as president, Nursultan Nazarbayev,72, has eschewed democratic freedoms in pursuit of theoil-fuelled growth and investment that has made Kazakhstan's$185 billion economy the largest in Central Asia.

Authorities have tried in recent years to balance theirdesire to preserve stability and economic growth with efforts toimprove the Kazakh image on the world stage.

The United States has said Kozlov's case would be a test forthe democratic credentials pledged by Kazakhstan when it chairedthe Organisation for Security and Cooperation in Europe in 2010.

Kozlov, 52, clenched his fists when the judge read out hissentence in front of several dozen supporters in a court inAktau, a city 2,600 km (1,625 miles) west of the capital Astana.

Aktau is the capital of Mangistau, the western Kazakh regionwhere employees of state-run oil companies staged a months-longprotest in 2011 after being fired for striking over wages.

On Dec. 16, a riot erupted in the main square of Zhanaozen.Police opened fire and at least 14 people were killed. Anotherperson died when rioting spread next day to a nearby village.

Judge Berdybek Myrzabekov said Kozlov had turned a labourdispute into a politicised strike after travelling the countryto find "weak spots" under orders from Mukhtar Ablyazov, an archfoe of Nazarbayev and the former head of BTA bank .

Ablyazov left Kazakhstan in 2009 and was granted politicalasylum in Britain last year as he awaited fraud charges he sayswere politically motivated. His whereabouts are unknown since hefled London in February after being sentenced there for contemptof court.


Back home, Kazakhstan's marginalised opposition enjoyslittle popular support. Despite never having held an electionjudged fair by international monitors, Nazarbayev is praised forpresiding over stability relative to neighbouring states.

But authorities have grown more wary of dissent after streetprotests in Russia, which shares a language favoured by millionsof its citizens and remains Kazakhstan's biggest trade partner.

In an interview with pro-government Russian television onSunday, Nazarbayev said "people with bad intentions" hadexploited a simple labour dispute for their own criminal ends.

"The puppeteers were far away. They weren't even there, butdirected everything that went on," he told Russia's Channel One.

Many of Kozlov's supporters chanted "Shame!" as theseven-week trial ended. As he was being led away, Kozlov grabbeda wooden barrier for support and said: "This is not a propertrial, but persecution. What has just happened here is a crime."

His political associate Mikhail Sizov called the sentence"outrageous" and said he would fight for Kozlov's release.

Kazakhstan's government rejected opposition claims the casewas politically motivated.

"Court proceedings were conducted in an open manner andabsolutely everybody was able to participate," Foreign Ministryspokesman Altay Abibullayev said. "Such practices are notwidespread even in many countries with developed democracies."

Kozlov was arrested in January, a week after Kazakhstan helda parliamentary election in which his Alga! party, long deniedofficial registration, was not eligible to stand.

The election admitted three parties to parliament for thefirst time, a small concession to democracy. But the second- andthird-placed parties are broadly sympathetic to the ruling partyand OSCE vote observers said genuine opposition had been barred.

Several opposition activists and two defence lawyers missedthe sentencing because their flight from Almaty was delayed, aproblem attributed by the airline to a fault with their plane.

Kozlov's two co-defendants, opposition activists SerikSapargaly and Akzhanat Aminov, walked free after being handedsuspended sentences. Aminov had pleaded guilty.

(Writing by Robin Paxton; Editing by Mark Heinrich and DianaAbdallah)

((robin.paxton@thomsonreuters.com)(+7 7272 508 500)(ReutersMessaging: robin.paxton.thomsonreuters.com@reuters.net))