Kazakhstani content is a priority
Soon the Government together with the companies developing the largest fields will approve the Roadmap for the development of oil and gas engineering.
It is expected that within the framework of preliminary negotiations the level of Kazakhstani content in the Karachaganak Expansion Project will be 40% or about 1.2 billion US dollars. Makhambet DOSMUKHAMBETOV,
First Vice Minister of Energy of the Republic of Kazakhstan, spoke about plans to develop local production against the backdrop of upcoming major capital projects in an interview with KAZSERVICE.
It is expected that within the framework of preliminary negotiations the level of Kazakhstani content in the Karachaganak Expansion Project will be 40% or about 1.2 billion US dollars. Makhambet DOSMUKHAMBETOV,
First Vice Minister of Energy of the Republic of Kazakhstan, spoke about plans to develop local production against the backdrop of upcoming major capital projects in an interview with KAZSERVICE.
- Makhambet Dzholdasgalievich, at the moment new measures for the development of domestic oil and gas engineering are being discussed at the level of Prime Minister Askar Mamin. What prospects does the Ministry of Energy see in this area, does your department have any new proposals to support Kazakhstani contractors?
- For the Ministry of Energy, as well as for the Government as a whole, the issue of developing the domestic oil and gas industry is a priority. And work in this area is being carried out on an ongoing basis. In particular, the Prime Minister gave instructions to work out the issue of developing oil and gas engineering, within the framework of which a working group was created, and meetings were held with representatives of government agencies, large operators, associations, domestic plants and other interested organizations.
At the meetings, they noted the need to consider the range of planned and actually purchased by large operators (TCO, KPO, NCOC) basic production goods within the medium term. Data on the most popular products not only for the three major operators, but also for the industry as a whole were also reviewed.
We had working meetings with technical specialists from major operators and domestic manufacturers. As a result, we formed a list of 26 types of products. During the preliminary analysis, the interest of oil and gas engineering enterprises in the production of products for major operators was: NCOC - 67 million US dollars, KPO - 307 million US dollars, TCO - 133 million US dollars, for other subsoil users - 248 billion tenge. Currently, 17 Kazakhstani enterprises interested in the production of products in accordance with the technical and quality requirements of major operators have been identified.
Nevertheless, work in this direction continues and in the future, within the framework of this task, it is planned to approve the relevant roadmap by the working group. It is worth noting that further work in this area will be carried out by the Ministry of Industry and Infrastructure Development with the support of the Ministry of Energy and stakeholders.
- Large capital projects are expected in the Kazakh oil and gas sector, such as the Second Phase at the Kashagan field and the Karachaganak Expansion Project. Can you name the fundamentally important points for Kazakhstan in the implementation of these projects? Kazakh content, technology transfer and experience transfer, for example.
- Kazakh content, technology transfer and experience transfer are the main priority areas in the implementation of large projects. For several years, the Ministry of Energy has been working together with large operators and other organizations to improve conditions for the Kazakh segment of the oil and gas market.
In particular, as you know, within the framework of the expansion project in Tengiz - the Future Growth Project (FGP-WPMP), significant work has been carried out to localize production, create joint ventures (in 10 areas, for the purpose of technology transfer and experience transfer) and train Kazakh personnel. Over 430 direct contracts and over 1,100 subcontracts were concluded with Kazakh companies within the framework of the FGP-WPMP.
The local content percentage of 32% set by TCO within the FGP-WPMP is being met. At the same time, the Ministry of Energy, together with TCO and its general contractors, have worked to establish minimum local content requirements in contracts. If any problematic issues arise, the Ministry of Energy provides comprehensive support for their resolution and discussion of solutions within the existing dialogue platforms.
The experience gained within the framework of the FGP-WPMP project is planned to be applied to future oil and gas expansion projects. Within the framework of preliminary negotiations on the Karachaganak Expansion Project, a planned local content percentage of 40% was set, which is about 1.2 billion US dollars from the project, which will be used to purchase goods, works and services of Kazakhstan origin, provided that they meet the quality and technical characteristics provided by KPO.
With regard to the Second Phase at the Kashagan field, a number of issues remain open and are under discussion.
It should be noted that domestic companies should pay attention to improving the quality of supplied goods and rendered works and services in order to gain the opportunity to participate in large projects.
- Kazakhstan has successfully completed the modernization of oil refineries and can now begin exporting its own petroleum products. To which countries can Kazakhstan supply its gasoline and with whom are negotiations already underway?
- Currently, the export of diesel fuel, aviation fuel, light distillates, gasoles, toluene and xylenes is prohibited from the territory of the Republic of Kazakhstan outside the customs territory of the EAEU. At the same time, you know that the export of high-octane gasolines and
- For the Ministry of Energy, as well as for the Government as a whole, the issue of developing the domestic oil and gas industry is a priority. And work in this area is being carried out on an ongoing basis. In particular, the Prime Minister gave instructions to work out the issue of developing oil and gas engineering, within the framework of which a working group was created, and meetings were held with representatives of government agencies, large operators, associations, domestic plants and other interested organizations.
At the meetings, they noted the need to consider the range of planned and actually purchased by large operators (TCO, KPO, NCOC) basic production goods within the medium term. Data on the most popular products not only for the three major operators, but also for the industry as a whole were also reviewed.
We had working meetings with technical specialists from major operators and domestic manufacturers. As a result, we formed a list of 26 types of products. During the preliminary analysis, the interest of oil and gas engineering enterprises in the production of products for major operators was: NCOC - 67 million US dollars, KPO - 307 million US dollars, TCO - 133 million US dollars, for other subsoil users - 248 billion tenge. Currently, 17 Kazakhstani enterprises interested in the production of products in accordance with the technical and quality requirements of major operators have been identified.
Nevertheless, work in this direction continues and in the future, within the framework of this task, it is planned to approve the relevant roadmap by the working group. It is worth noting that further work in this area will be carried out by the Ministry of Industry and Infrastructure Development with the support of the Ministry of Energy and stakeholders.
- Large capital projects are expected in the Kazakh oil and gas sector, such as the Second Phase at the Kashagan field and the Karachaganak Expansion Project. Can you name the fundamentally important points for Kazakhstan in the implementation of these projects? Kazakh content, technology transfer and experience transfer, for example.
- Kazakh content, technology transfer and experience transfer are the main priority areas in the implementation of large projects. For several years, the Ministry of Energy has been working together with large operators and other organizations to improve conditions for the Kazakh segment of the oil and gas market.
In particular, as you know, within the framework of the expansion project in Tengiz - the Future Growth Project (FGP-WPMP), significant work has been carried out to localize production, create joint ventures (in 10 areas, for the purpose of technology transfer and experience transfer) and train Kazakh personnel. Over 430 direct contracts and over 1,100 subcontracts were concluded with Kazakh companies within the framework of the FGP-WPMP.
The local content percentage of 32% set by TCO within the FGP-WPMP is being met. At the same time, the Ministry of Energy, together with TCO and its general contractors, have worked to establish minimum local content requirements in contracts. If any problematic issues arise, the Ministry of Energy provides comprehensive support for their resolution and discussion of solutions within the existing dialogue platforms.
The experience gained within the framework of the FGP-WPMP project is planned to be applied to future oil and gas expansion projects. Within the framework of preliminary negotiations on the Karachaganak Expansion Project, a planned local content percentage of 40% was set, which is about 1.2 billion US dollars from the project, which will be used to purchase goods, works and services of Kazakhstan origin, provided that they meet the quality and technical characteristics provided by KPO.
With regard to the Second Phase at the Kashagan field, a number of issues remain open and are under discussion.
It should be noted that domestic companies should pay attention to improving the quality of supplied goods and rendered works and services in order to gain the opportunity to participate in large projects.
- Kazakhstan has successfully completed the modernization of oil refineries and can now begin exporting its own petroleum products. To which countries can Kazakhstan supply its gasoline and with whom are negotiations already underway?
- Currently, the export of diesel fuel, aviation fuel, light distillates, gasoles, toluene and xylenes is prohibited from the territory of the Republic of Kazakhstan outside the customs territory of the EAEU. At the same time, you know that the export of high-octane gasolines and