Oil Chronicles
Oil Chronicles. January 2025
January 2025
Russia has maintained duty-free quotas for Kazakhstan in 2025, allowing the supply of 1.12 mln tons of motor fuel and fuel oil, as well as approving the export of 225,000 tons of gasoline from the Condensate refinery beyond the Eurasian Economic Union (EAEU).
According to the intergovernmental agreement on trade and economic cooperation in petroleum product supplies for 2025, the quota for duty-free Russian gasoline deliveries to Kazakhstan is set at 285,000 tons, including: 92 RON – 240,000 tons, 95 RON – 40,000 tons, and 98 RON – 5,000 tons. Additionally, Kazakhstan can import 450,000 tons of diesel fuel, 300,000 tons of aviation kerosene, and 85,000 tons of fuel oil for BaikonurEnergo, all without duty payments.
Furthermore, the Condensate refinery in the West Kazakhstan region, which processes Russian naphtha, has been allocated an export quota of 225,000 tons of 92 RON and 95 RON gasoline beyond the EAEU. This quota was first approved last year. For all other Kazakhstani producers, partial restrictions or a complete ban remain in place for exports of light distillates, diesel fuel, aviation kerosene, aromatic hydrocarbons, and bitumen beyond the EAEU.
Kairat Otarov, former head of the National Security Committee (KNB) Department for the Aktobe region, has been appointed Deputy General Director for Administrative and Social Affairs of Mangistaumunaigas JSC. He is well-acquainted with the issues of the Mangystau region, having previously worked in Aktau as part of the leadership of the regional KNB Department. His life and professional experience are expected to put an end to the numerous strikes that have shaken the western region in recent years.
Kazakhstan is lowering its oil production forecast for the current year by 1 mln tons. While the initial target was set at 97.2 mln tons, in early January, the Ministry of Energy adjusted it to 96.2 mln. Most likely, the revision is linked to the ongoing maintenance at Tengiz, which began in October and was originally scheduled to be completed by the end of November last year.
Lukoil has invited KazMunayGas to participate in the bidding process for acquiring a refinery in Burgas, Bulgaria.
The Russian company began seeking buyers for its Bulgarian asset in December 2023 after the Bulgarian government raised the corporate profit tax for LUKOIL Neftochim Burgas to 60%, imposed a €87.5 mln fine for market dominance abuse, and terminated the concession agreement for the Rosenets oil terminal near the port of Burgas, which supplied the refinery with crude oil.
According to Bloomberg estimates, the sale price could be around $1 bln. A key advantage for KMG is that the Bulgarian refinery was initially designed to process Russian Urals crude chemically identical to Kazakhstan’s KEBCO blend. Additionally, Kazakhstan would benefit from a short transport route to Burgas via the Black Sea from Novorossiysk.
January 8, KazMunayGas subsidiary Embamunaigas JSC commenced drilling its first exploration well at the Taisoygan site in the Atyrau region. By the end of 2025, the company plans to drill eight supra-salt Mesozoic structures within the Pre-Caspian sedimentary basin, at depths ranging from 400 to 3,800 meters. The drilling targets were selected based on large-scale 3D seismic surveys covering an area of 5,600 sq. km. The site is located near the Uaz, North Uaz, and Kondybai fields.
Since 1949, the Taisoygan area has been a Soviet Union strategic missile forces testing ground. Between 1966 and 1977, 24 underground nuclear tests were conducted there. In 2015, under an intergovernmental agreement, the territory was transferred to Kazakhstan’s jurisdiction.
January 10, the United States imposed new sanctions on Russia’s oil sector, affecting Gazprom Neft-Kazakhstan LLP and Gazpromneft-Kazakhstan Operating Company LLP, which operate a network of gas stations in Kazakhstan under the Gazprom Neft brand.
Also sanctioned:
- Vadim Vorobyov, General Director of Lukoil PJSC and member of the Foreign Investors’ Council under the President of Kazakhstan (a strategic partner of KazMunayGas in exploration and production projects);
- Nail Maganov, General Director of Tatneft PJSC (a strategic partner of KMG in the Karaton Subsalt, Butadiene, and Tire Plant projects in Saran);
- Alexander Dyukov, Chairman of the Management Board of Gazprom Neft PJSC (operating a network of gas stations in Kazakhstan);
- Sergey Kudryashov, General Director of Zarubezhneft JSC (signed a memorandum of intent with KazMunayGas on joint projects).
January 10, KazMunayGas signed agreements with Shell and Chevron for access to geological data, enabling the efficient use of seismic survey results for planning joint exploration activities. The partnership is focused on assessing the Mugodzhar project in Aktobe Region.
The operator of the Kashagan consortium, NCOC, has been ordered to pay 3.5 bln KZT to Kazakhstan’s budget for gas flaring. The Astana Economic Court handed down the decision following a lawsuit filed by the State Inspection for Oil and Gas Operations under the Ministry of Energy. The defendant’s representatives challenged the court’s jurisdiction, arguing that the case should be resolved through international arbitration, as Kashagan is being developed under the North Caspian Production Sharing Agreement (PSA). However, the court dismissed the objection and upheld the fine.
January 13, Abai Beisembayev was appointed Deputy General Director for Transportation and Member of the Management Board of KazTransOil JSC.
A graduate of Satbayev KazNRTU with a degree in Pipeline and Storage Facility Design and Operations, as well as Kainar University in International Economic Relations, Beisembayev has spent his entire career at KazTransOil. He began in 2001 as an operator at the Kenkiyak production and dispatch station within the company’s Aktobe branch. He steadily moved up the corporate ladder, serving as Head of the Central Oil Transportation Control Division from 2020 to 2022, and since August 2022, as Director of KazTransOil’s Transportation Department, before his latest appointment.
The new head of KazTransOil’s subsidiary, which operates the Atasu-Alashankou and Kenkiyak-Kumkol pipelines, is Talgat Kurmanbayev. He replaces Tian Aimin, a representative of Chinese shareholder CNODC, who has now been promoted to First Deputy General Director.