Presentation
KazRosGas: Investing in the Future
The Kazakh-Russian joint venture KazRosGas is one of the vivid examples of bilateral cooperation which only will deepen in the process of formation of the Common Economic Space between Kazakhstan, Russia and Belarus. If it is true that politics is a concentrated expression of the economy, than also true is the opposite postulate: at times the economy in the concentrated way reflects the major features of the country’s political course.
The example of KazRosGas here is the most indicative, as it demonstrates a course on friendship and multilateral relationship with its near and far abroad countries, mutually beneficial cooperation and a rational use of natural riches, with which nature has awarded our countries, for the society’s welfare.
It is considered the origin of KazRosGas June 7, 2002 when in St.-Petersburg, during the official meeting of the heads of Kazakhstan and Russia Nursultan Nazarbayev and Vladimir Putin, the charter documents were signed on forming a joint venture. A legal basis for a JV became the Agreement of November 28, 2001 concluded between the governments of the two countries on cooperation in the gas industry.
The need for adopting such agreement was dictated by life: Kazakhstan, possessing considerable reserves of gas, nevertheless experienced its deficiency on the domestic market. At the same time, the consortium, developing the Karachaganak oil and gas condensate field in the Western Kazakhstan region, had big problems with the marketing of its products because all its transportation infrastructure was tied to Russia.
The conclusion of the agreement made it possible to transfer relations in the gas industry between Kazakhstan and Russia to a level of equal and mutually beneficial cooperation and partnership.
One more important document in the legal framework of JV’s efficient activity became signing in June 2006 in St. Petersburg by Nursultan Nazarbayev and Vladimir Putin of the joint Declaration in which the governments of the Republic of Kazakhstan and the Russian Federation were entrusted to sign an intergovernmental agreement on forming a JV on the basis of the Orenburg Gas Processing Plant under the simultaneous conclusion of long-term contracts.
These agreements ensured the processing of Kazakhstani gas on the mutually beneficial conditions. As a result, Kazakhstan provided its domestic market with gas, while Russia, due to the included point on long-term contracts, obtained guarantees on the plant’s regular loading. On October 3, 2006 the second agreement was signed in Uralsk by the governments of Kazakhstan and Russia on cooperation and formation of an economic society on the basis of the Orenburg Gas Processing Plant.
On May 31, 2007 KazRosGas concluded the 15-years contracts with Karachaganak Petroleum Operating for the purchase and sale of sour gas extracted from Karachaganak field, and with the subsidiary OJSC Gazprom – for the purchase and sale of dry gas from Karachaganak.
Thus, since 2007, KazRosGas is conducting processing of Karachaganak gas at the Orenburg Gas Processing Plant under a direct contract. So, the direct, transparent and efficiently functioning system of gas deliveries and processing and the sale of end products on a mutually beneficial basis has been created. At present, all key agreements are functioning with their main indices being specified on an annual basis.