Oil Chronicles. March - April 2023
Starting March 1, Dmitry Makeev has been appointed as the Deputy Chairman of KazMunayGas, where he will oversee the oil refining and petrochemical sector. Since December 2019, Makeev held the position of Director of the Oil Refining and Petrochemicals Department at the national company. From 2005 to 2019, he worked at the Atyrau Refinery, progressing from an operator to the Managing Director for Technology.
He replaced Arman Kayirdenov in this role, who was dismissed following several major incidents at KMG-owned refineries.
Vice Minister of Energy, Zhanat Zhakhmetova, has voluntarily resigned. Within the ministry, she was responsible for the digitalization of the industry. She has transitioned to work for the KPO consortium as the Managing Director for IT and process enhancement.
Sabit Arynov has been appointed as the General Director (Chairman of the Board) of Embamunaygas JSC. He previously served as the Deputy General Director for Production at KazTransOil JSC. Over the years, he held various positions within KazTransOil, including Director of Operations and Head of the Western Branch.
Five Kazakhstanis have been approved for a 5-year internship at Chevron's office in the USA. It's expected that upon completion of the internship, one of them will lead the company Tengizchevroil and will be the first Kazakhstani leader of the joint venture.
Heading for an internship in San Ramon, California are Dauren Karabayev, Deputy Chairman of the KMG Board for Finance; Oryn Sultanov, former General Manager of NCOC for External Relations; Zamzagul Bekova, CFO of TCO; Kalibek Mukhanov, General Manager for Strategic Planning at TCO; and Dauletjan Khasanov, Deputy Chairman of the KMG Board for Production.
Private company Nostrum Oil & Gas PLC, involved in oil and gas extraction, as well as exploration and development in the Caspian Basin, has acquired an 80% stake in Positive Invest LLP for $20 mln. Positive Invest holds the extraction rights for hydrocarbons at the Kamensk and Kamensko-Teplovo-Tokarevsk (known as the "Steppe Leopard") fields in the West Kazakhstan region.
Management estimates suggest that the extractable reserves of the "Steppe Leopard" sites range between 50-150 mln boe, which are considered contingent resources with a liquid hydrocarbon content of over 20%. Licensing agreements cover 8 fields, where, during the Soviet era, over 100 wells were drilled, confirming the presence of hydrocarbon deposits, the company reports.
It is anticipated that Nostrum will process the extracted hydrocarbons at the company's nearby gas processing facilities.
KazMunayGas pulls out of the Isatay project and returns the site to the government.
According to the 2022 financial report, the national company acknowledged a loss from exploration and valuation of the Isatay project amounting to 3.2 bln tenge. Consequently, a decision was made alongside its partner company, Isatay Operating Company, to withdraw from the project and return the contract territory to the government. Italian firm Eni owns 50% of Isatay Operating Company.
Karachaganak Petroleum Operating (KPO) is engaged in arbitration proceedings with JSC KazRosGas over gas prices. This was revealed from the consolidated financial statement of KazMunayGas for 2022. In KazRosGas, KazMunayGas has a 50% stake on par with Gazprom, while holding a 10% stake in the Karachaganak project.
On August 23, 2022, the International Chamber of Commerce in Paris sent a notification to KazRosGas announcing the initiation of arbitration proceedings by KPO. KPO intends to increase the sale price of gas under the current Karachaganak gas purchase agreement. If the gas price is agreed upon later than October 1, 2022, both KazRosGas and KPO will adjust the gas price from October 1, 2022, until the date the price is settled. In December 2022, KPO expressed readiness for further discussions to reach a potential price review settlement. In January 2023, KazRosGas proposed a 3-month suspension of the arbitration proceedings to KPO, as stated in the national company's report.
Starting March 24, Esen Uteev was appointed as the General Director of the KazMunayGas office in Aktau. Previously, he served as the Executive Director at the KazMunayGas representative office. As reported by the national company's press service, between 2019 and 2022, Uteev was the General Director of Ozenmunaygas JSC. Kurmangazy Iskaziyev, who previously headed the KazMunayGas office, left his position due to his transition to the role of General Director at Kalamkas-Khazar Operating.
KLRE LLP underwent a rebranding and is now called KMG PetroChem LLP. KazMunayGas is the sole member of the company.
KMG PetroChem will be undertaking the following projects: constructing a gas separation complex at Tengiz; building main pipelines (ethane and propane pipelines from Tengiz to Karabatan); and constructing a polyethylene production plant in the Atyrau region.
The head of KazMunayGas, Magzum Mirzagaliyev, held talks with Mohamed Juma Al-Shamisi, Chairman of the Abu Dhabi Ports Group. They discussed the development strategy for their joint venture, Caspian Integrated Maritime Solutions (CIMS), which was officially registered and began operations in February of this year.
During the talks, KazMunayGas and ADP focused on expanding CIMS's tanker fleet for oil transportation in the Caspian and Black Sea regions. The joint venture currently plans to acquire tankers with a deadweight of 8-12 thous. tons. Additionally, both parties talked about enhancing the capabilities of the Aframax/Suezmax fleet used in open waters.
Kazakhstan has filed a lawsuit against the Kashagan field operator, NCOC, for $5.1 mln. This amount represents penalties for environmental pollution. According to Bloomberg, the Ministry of Ecology accuses NCOC of storing sulfur beyond permissible limits, which is produced when cleaning oil extracted from the field of hydrogen sulfide, along with other environmental violations.