Oil production and export in Kazakhstan

Main article: Economy of Kazakhstan

Chronicle

2023

Kazakhstan doubled oil exports bypassing Russian ports to 3.73 million tons in a year

Supplies of Kazakh oil and gas condensate bypassing Russian ports in 2023 reached 3.73 million tons against 1.91 million tons a year earlier. This became known in early February 2024.

As Kommersant writes with reference to Reuters, which, in turn, cites data from its sources, in 2023 oil supplies from the port of Aktau towards Azerbaijan increased to 1.5 million tons from 0.3 million tons in 2022. Export through the Baku-Tbilisi-Ceyhan oil pipeline (BTC) increased to 1.4 million tons. The main suppliers of raw materials on this route are Tengizchevroil (72%), Total & Dunga (18%), Zhaikmunai (5%) and Buzachi Neft (4%).

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The volume of exports along the Trans-Caspian route, according to the agency, reached 1.55 million tons in 2023. The Trans-Caspian route runs through China, Kazakhstan, the Caspian Sea, Azerbaijan, Georgia, Turkey and European countries. On February 5, 2024, the press service of the Government of Kazakhstan announced that within two years the republic plans to increase the volume of oil supplies along the Trans-Caspian route to 3 million tons.

By February 2024, the main way for the export of Kazakhstani raw materials is through the Russian port of Novorossiysk by the capacity of the Caspian Pipeline Consortium (CPC). About 80% of all Kazakhstani oil exports go through it. Last year, Kazakhstan supplied 56 million tons of oil along this route. In 2024, the republic plans to increase exports through the CPC to 63.7 million tons.

At the same time, Kazakhstan is looking for alternative routes for transporting its oil to Europe, since the CPC remains an unstable option due to weather and political conditions. In January 2024, due to storm conditions in Novorossiysk, CPC stopped transshipment of Kazakh oil.^[1]

Kazakhstan sues world's largest oil companies that violated tender terms

And in April 2023, Kazakhstan sued the largest oil companies in the world, which violated the terms of the tender and did not complete the work in full.

Partners in the projects Shell, Exxon Mobil, Eni and TotalEnergies are also accused of unauthorized expenses in the amount of $13 billion in Kashagan and $3.5 billion in Karachaganak, sources say. Kashagan partners also face a fine of $5.1 billion for violating environmental standards.

In addition to generating more revenue from the sale of oil through arbitration, the Government of Kazakhstan intends to change the system of tenders used by oil enterprises in order to make this process more efficient for the national economy, including by increasing the revenues of local companies.

Attempts to increase supplies to the EU through the Druzhba pipeline

Kazakhstan [1] is struggling to find enough crude oil to meet European countries' requests for supplies through Russia's Druzhba pipeline system, which would allow them to scale back their deals with Russia amid the conflict in Ukraine.

According to the state-owned oil pipeline operator KazTransOil, Germany should receive a total of only 40,000 tons of Kazakh oil in the first quarter. This is almost 90% less than originally planned.

Oil producers can make higher profits on other export routes. Deliveries through Russia will depend on further goodwill. Moscow

2022

Kazakhstan reduced annual oil production by 2%. US and Europe control 48% of production

Oil production in Kazakhstan in 2022 reached 84.1 million tons, which is 2% less than a year earlier. This is evidenced by data from the British Energy Institute, which were released at the end of June 2023.

According to the study, by the end of 2022, Kazakhstan accounted for 1.9% of the global oil production. Gas production in Kazakhstan in 2022 fell by 2.8% to 26 billion cubic meters (0.6% of global production). Gas consumption in the country in 2022 increased by 0.4%, to 21.7 billion cubic meters.

Kazakhstan reduced annual oil production by 2%, gas - by 2.8%

In January 2023, the Minister of Energy of Kazakhstan Bolat Akchulakov said that the volume of oil production in the country in 2022 amounted to 84.2 million tons, which is 1.9% less than a year ago. Gas production decreased to 53.3 billion cubic meters. The indicator decreased by 1%, exports amounted to 4.6 billion cubic meters. In addition, the production of other minerals decreased by 7.6%, Akchulakov reported.^[2]

Kazakhstan increased oil exports bypassing Russia by 64%

At the end of 2022, Kazakhstan supplied 1.8 million tons of oil (an average of 36 thousand barrels) bypassing Russia, which is 638 thousand tons more (64%) than a year earlier. Such data in early February 2023 is quoted by Reuters, citing its own calculations.

On routes bypassing Russia, 1.26 million tons of Kazakh oil were delivered to China, 214 thousand tons were sent through the Georgian port of Batumi, 141 thousand tons - to an oil refinery in Baku, 109 thousand tons - to the Baku-Tbilisi-Ceyhan pipeline and 80 thousand tons - to Uzbekistan.

Reuters calculations confirm the data of the macroeconomic review of Kazakhstan, prepared by the Center for Applied Economics Research (AERC). Kazakhstan in 2022 sent 1.7% less oil to the Caspian Pipeline Consortium (CPC) than a year earlier, the document says. In total, Kazakhstan exported 64.8 million tons of oil last year, of which the CPC accounted for 81.2%.

At the end of December 2022, it became known that the Kazakh national energy company KazMunayGas (KMG) was going to replace Russian oil in Germany. A batch of 20 thousand tons of oil will be sent in the first half of February. Europe's embargo on the purchase of Russian oil, which entered into force on December 5, does not apply to pipeline supplies under Druzhba, but many countries have promised to abandon them on their own in 2023. Germany, in particular, pledged to stop importing Russian raw materials through the oil pipeline by December 31, 2023.

Batumi is an alternative direction (to Russian ports), while the economy does not play a role, a Reuters source explains.

American Ambassador to Astana Daniel Rosenblum said that the United States promised to support the authorities of Kazakhstan and help find alternative ways to export oil.^[3]

2021

Oil production in thousands of barrels per day by country in 2021

2017

Kazakhstan is one of the largest oil-producing countries in the world. As of August 2017, the country ranks 17th in the world in terms of production.

There are more than 200 oil fields in Kazakhstan. According to the annual report of BritishPetroleum at the end of 2015, proven oil reserves in the country amounted to 30 billion barrels. According to this indicator, the country ranks 12th in the world.

The forecast reserves are estimated by experts at 11-12 billion tons, most of which lies in the bowels of the three largest deposits:

• Tengiza (5-6 billion tons),
• Karachaganaka (1.2 billion tons) and
• offshore Kashagan (3 billion tons).

By 2017, over a quarter of a century of independent development, Kazakhstan managed not only to overcome a slight decline in oil production in the mid-1990s, but also to increase its volumes more than threefold compared to 1992. For the development of the largest fields, consortia were created with the participation of foreign companies on PSA terms. National and foreign companies now produce about 80 million tons of oil and gas condensate annually.

The main oil producers of Kazakhstan:

• NK Kazmunaigas,
• Tengizchevroil,
• CNPC-Aktübemunaigas,
• Karachaganak Petroleum Operating,
• Rosneft and others.

Kazakhstan signed an agreement with OPEC to reduce production in 2017 by 20 thousand barrels per day, which per year is about 1 million tons.

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