Olzhas Bektenov: Oil and gas industry to work for welfare of all Kazakhstanis

Head of the Government Olzhas Bektenov held a meeting on the oil and gas industry development, El.kz cites primeminister.kz.

During the meeting the current challenges and prospects of oil production, oil refining, as well as plans to implement new projects in geological exploration were discussed.

As Prime Minister noted, the Head of State has set tasks for the Government to develop and increase the investment attractiveness of the oil and gas sector. Last year the country produced 90 million tonnes of oil, the confirmed reserves are estimated at 2.9 billion tonnes. The industry generates a significant part of tax revenues and jobs.

Olzhas Bektenov stressed the importance of launching major projects in Kazakhstan, including a petrochemical plant in the Atyrau region with a capacity of 500 thousand tonnes of polypropylene per year, the start of construction of three gas processing plants. Prospects for the construction of butadiene and polyethylene plants were discussed.

Tax and investment legislation is being improved, amendments were made to the Entrepreneurship Code and the Code on Subsoil and Subsoil Use to reduce the burden on enterprises. An improved model contract for complex projects has been introduced, which enshrines a package of regulatory and fiscal preferences for subsoil users.

The government is planning further reforms aimed at liberalising the oil and oil products market. For this purpose, a package of legislative amendments to the Tax and Budget Codes, the Code "On Subsoil and Subsoil Use" is being developed, which will give additional incentives to subsoil users and producers of petroleum products.

In turn, business is expected to respond by significantly increasing the share of local content and supporting domestic producers. An important role here is assigned to three large consortia - Tengizchevroil, Karachaganak Petroleum Operating B.V. and North Caspian Operating Company N.V., which account for 70% of all purchases in the industry.

"The oil and gas industry, first and foremost, must work for the benefit of all Kazakhstanis. We strive to ensure that as much of the revenues from oil and gas activities as possible remain in Kazakhstan, contributing to the development of national business, creating jobs and improving the living standards of our citizens. It is also necessary to pay due attention to local human resources. In many reports we see that more than 90 per cent of employees are Kazakhstani. But this cannot be said about the managerial level. Today the country has enough managers with experience of work in the world's best oil and gas companies. We need to offer them promising positions in projects,"Olzhas Bektenov emphasised.

The government pays special attention to support geological exploration with the creation of conditions for attracting investment. In this regard, the companies were invited to more actively conduct research work on the study of deep-lying horizons. Prime Minister also focused on environmental issues, emphasising the importance of a balance between economic development and environmental sustainability. For this purpose it is necessary to invest more actively in innovative developments and new technological solutions.

Askhat Hasenov, Chairman of the Board of NC KazMunayGas JSC, Derek Magnes, Managing Director of the Eurasian division of Chevron Corporation, Magzum Mirzagaliyev, Chairman of the Association KAZENERGY, Li Shufeng, General Director of SNPS-Aktobemunaigas JSC, and others made reports on the situation in the oil and gas industry.

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