Results and Prospects
Year in Review: Oil, Gas, Petrochemicals, and Local Content
The Ministry of Energy summed up the results of the work of the oil and gas industry in 2021 during the extended board meeting.
Oil production and export
According to the results of 2021, 85.9 mln tons of oil were produced in Kazakhstan; the plan for 2022 is 87.5 mln tons. Of this volume, 67.6 mln tons of oil were exported (the goal for 2022 is 69 mln tons). The petroleum products production volume amounted to 12.7 mln tons.
Three major projects remain the drivers of oil production – Tengiz, Karachaganak, and Kashagan. Oil production under the Tengiz project amounted to 26.5 mln tons in 2021 (31% of all oil production in the country and 33% of oil exports from the country). In 2022, production volumes should increase to 28.7 mln tons. According to the current year's results, the FGP-WPMP implementation rate should reach 97.4%.
The Kashagan offshore field produced 16.2 mln tons of oil in 2021 (19% of all oil production and 17% of exports). In 2022, annual production is expected to decrease by one mln tons of oil. Production at Karachaganak amounted to 11.5 mln tons of oil at the end of the year (13% of both oil production and exports from the country). In 2022, the target figure is 11.6 mln tons. Karachaganak continues to implement projects to maintain the liquid hydrocarbons production plateau at 11-12 mln per year. The project to increase gas processing capacity has been fully implemented, the project of the 4th gas re-injection compressor has been completed, commissioning works are underway. The overall progress on the 5th gas re-injection compressor project, designed for 2021-25, was at 17.5% by the end of last year. By the end of this year, the indicator should reach 38%.
Of the 67.6 mln tons of crude oil exports, 53.1 mln tons were transported via the Tengiz-Novorossiysk pipeline of the Caspian Pipeline Consortium; 11.17 mln tons via Atyrau-Samara; 0.966 mln tons via the Atasu-Alashankou pipeline. Through the Aktau seaport, 2.1 mln tons were exported, 0.2 mln tons of oil were shipped by rail.
Gas industry
In 2021, 53.8 bln cubic meters of gas were produced in Kazakhstan; the goal for 2022 is 54.5 bln cubic meters. Commercial gas production amounted to 29.4 bln cubic meters; the goal for 2022 is 29.6 bln cubic meters. Gas exports amounted to 7.2 bln cubic meters; the expected volume of exports in 2022 is five bln cubic meters. As of January 1, 2022, the country's gasification level was 57.7%, which means that 11 mln Kazakhstanis have access to gas.
Together with interested government agencies and the national operator QazaqGaz, the Ministry of Energy is developing a Comprehensive Plan for the gas industry's development aimed at "rebooting" the industry. The draft Comprehensive Plan includes the following activities:
First. Increase of the gas resource base due to geological exploration and new gas production projects at new and existing fields. As part of the incentive support measures, the issues of granting preferences for gas projects at all stages and the revision of gas injection programs at oil-producing projects from the point of view of their expediency are being worked out.
Second. A new gas pricing model, which should consider the limited resources of Kazakhstan's gas and the need to raise prices for commercial consumers to the level of market prices.
Third. The main gas transportation infrastructure was primarily built back in Soviet times and requires significant investments to maintain safe operation. It is necessary to conduct a technical audit of the state of the gas transportation infrastructure and identify sources of financing and mechanisms for return on investment.
Fourth. The Gasification Master Plan will be updated to continue sustainable gasification, the rules for transferring gasification facilities from local administration to the national operator's balance sheet will be simplified.