Twenty Years Of Successful Partnership
The Development of Local Suppliers is the Priority
KPO and Karachaganak Project partners fully support Government programs and initiatives aimed at the local content increase and industrial-innovative development of the country.
For two decades of operation KPO has established long-term partnerships with many Kazakhstani enterprises. Besides, one of the first programs on the development of the local content was created at the Karachaganak, which has been in force since 2001.
KPO is actively promoting the development of local suppliers of goods and services, and implements a number of efficient projects in support of local production. The companies that have received invaluable experience at the Karachaganak, become one of the most coveted contractors for many other projects, both domestically and abroad.
Award for investment activity in the local content development
According to the results of 2016, the share of KPO’s local content in the supply of goods, works and services reached 51.6%, which in monetary terms is around 530 million US dollars. In general, from the moment of the Final Production Sharing Agreement signing in 1997, the proportion of local content in the procurement of KPO exceeded 6.14 billion US dollars.
Within the framework of the current program on the development of the Karachaganak field, KPO actively involves local suppliers in more complex work by strengthening cooperation between international and local companies, with the aim of creating jobs, technology transfer and training of local personnel.
This work is conducted jointly with local and foreign service and engineering companies. And it brings a quite tangible results in the form of localization of production of several goods and services through the creation of joint ventures between foreign and local service providers. Thus, as a joint initiative between KPO and Tenaris a new threading plant was launched in Aktau in October of 2016.
In order to facilitate the development of the local content and technology transfer, KPO has introduced a fundamental requirement so that only joint ventures between foreign and local suppliers of goods and services are invited to the tenders, in order to contribute to the development of the local content and technology transfer.
In order to facilitate the development of the local content and technology transfer, KPO recently held the tenders for the supply of the following works and services:
- engineering and technical services;
- provision of solutions for drilling and injection into the wells;
- standard services for testing and development of wells;
- gas logging services
- standard services for provision of endless tubing units and pumping units;
- running the casing;
- services on provision of drilling rigs;
- slickline services and well inter-vention.
Essential is that only the joint ventures established with participation of foreign and Kazakhstani oilfield service companies were invited to those tenders.
Implementation of the strategy of joint ventures enabled KPO to attract world-class service companies such as Halliburton, Weatherford, Schlumberger, Worley Parsons, to collaborate with domestic enterprises in the course of developing the Karachaganak field.
The Company is open to cooperation with any local suppliers, who comply with the qualification requirements and have undergone preliminary assessment process and registered in a database of KPO suppliers, regardless of a region where production is located. In 2016, KPO held working meetings with the leaders of several regions of the country and representatives of the regional industrial enterprises, where the Company’s needs for goods and services, requirements for the pre-qualification of suppliers were presented, and perspectives of inter-regional cooperation were discussed.
KPO annually participates in the Kazneftegazservice Conference organized by KAZSERVICE Association, providing a platform for dialogue between the major oil and gas operators and representatives of the domestic and foreign trade associations, as well as the Kazakhstani construction and engineering companies. At this platform the Company presents opportunities for participation of the local contractors in the Karachaganak oilfield development projects.
KPO’s contributions to the development of the local content has been praised by the Governmental authorities and industry associations. Within the framework of the «Kazakhstan: new investment opportunities» Conference, organized by the Ministry of Investment and Development, the Company received the award for investment activity in the development of the local content.
A well-deserved reward marked the Company’s participation in the second Forum of Kazakhstani Producers Uly Dala Eli, which was held in Astana. The Forum was attended by the Minister for investment and development Zhenis Kasymbek, Chairman of the Board of the National Chamber of Entrepreneurs Atameken Ablay Myrzakhmetov, representatives of the national companies and subsoil users, and domestic manufacturers. In the framework of the Forum, a number of long-term contracts has been signed between the national companies and the manufacturers. In addition, during the awarding ceremony of the winners of the «Best buyer of 2016», KPO was announced the winner in the nomination «The Reliable Partner». In a solemn setting, the Deputy Director General of KPO Marat Karimov received a prize from organizers of the Forum. At the ceremony, it was noted that KPO is the first international, and oil & gas company to win this award.
As Marat Karimov stressed, at the present moment more than 3,900 local suppliers are listed in the Company’s database. «KPO continues to implement a number of initiatives to increase the local content in cooperation with other major international oil and gas companies, as well as local and foreign service and engineering companies. KPO and the Karachaganak partners remain true to their commitments relating to the strengthening of the local capacities through the implementation of sustainable development programs, the transfer of innovative technologies and professional skills, - said Deputy Director General of KPO. - The goal of the local content program of KPO fully coincide with the initiative of the Republic of Kazakhstan on the development of the national industry opportunities, and increase in participation of Kazakhstani companies in major oil and gas projects, such as the Karachaganak».
