Kazakhstan Oil & Gas
Kazakhstan : Largest Oil and Gas Reserve in Central Asia and Extensive Supporting Infrastructure
- Proved oil reserve = 30bn barrels (5 x Malaysia's oil reserve)
- Oil production = 1.5 million bopd (expected to double by 2020)
- Existing and continually developing oil and gas infrastructure
- Stable political regime
Kazakhstan has the second largest oil reserve and oil production among the former Soviet republics after Russia. At 30bn barrels of proved reserve Kazakhstan holds 3% of the world's oil, and is expected to increase further following increasing exploration activity in the country especially in the Caspian Sea.
The oil production of about 1.6 mil barrels per day represents an increase of 250% of its production in year 2000. The production is expected to double by year 2020 following the full production of the giant Kashagan and Karachaganak fields. The relatively low oil consumption of 240 thousand bbls/day allows the country to export 85% of its oil production.
Hydrocarbon Legislative Framework
The legislative and regulatory framework is developed and overseen by the Ministry of Oil and gas (previously known as the Ministry of Energy and Mineral Resources). The national oil and gas company, Kazmunaygaz (KMG), was established in 2002 to represent the state's interest in Kazakhstan's oil and gas industry. The Law on Subsurface and Subsurface Use is the governing law for the oil and gas exploration and production.
Two contract models are in use in Kazakhstan now, the Excess Profit Tax (EPT) Model and the Production Sharing Agreement (PSA). In early 2008 the government has stopped awarding new PSAs, and joint-venture EPT Model has taken its place. KMG has the first right of refusal for any exploration blocks, after which LMG may negotiate with potential partners on the joint venture stake and terms.