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  • President called oil service industry driver of economic growth

President called oil service industry driver of economic growth

5 September, 2019 16:32
The Head of State held an extended meeting on the development of the oil and gas industry during a working visit to Atyrau region, Akorda’s press service informed.

In his speech, Kassym-Jomart Tokayev emphasized that the fuel and energy complex plays a great role in the economy of Kazakhstan. Having noted the importance of further development of the oil and gas industry, the President posed a number of specific tasks for the Government and local executive bodies.

The Head of State pointed out the need for further implementation of such large projects as Kashagan, Tengiz and Karachaganak. In particular, Kassym-Jomart Tokayev instructed the Government, together with consortium contractors, to agree on a Roadmap for the full development of this field in order to systematically increase the level of oil production in Kashagan.

The President dwelled on the issue of transporting oil from the fields located in the west of the country to other regions of the republic. He set the task to complete the construction of the Kenkiyak-Kumkol oil pipeline by the end of this year. In addition, the Head of State expressed concern about a possible decrease in oil supplies to the domestic market.

“The supply of oil to the domestic market mainly comes from Aktobe and Kyzylorda regions. Given this, there are risks of reducing the volume of oil processed at domestic refineries. In order to maximize the efficient use of our resources, the Government should actively address this issue and make concrete proposals”, Kassym-Jomart Tokayev said.

The President called the development of the petrochemical industry an important area of ​​economic modernization.

“The petrochemical industry has a high multiplier effect on other sectors of the economy. The share of hydrocarbon consumption by the petrochemical industry in the world is 34%, while in Kazakhstan it is very small. Implementation of projects for the production of polypropylene and polyethylene could give an annual increase in GDP of 1.5% on average”, the Head of State said.

Highlighting the gas industry as another priority, Kassym-Jomart Tokayev noted good results in the development of the gas pipeline system. At the same time, he focused the attention of the Government on the need to ensure gas availability.

The President also touched on exploration issues in Kazakhstan. According to him, it is necessary to qualitatively replenish the reserves of mineral raw materials by strengthening exploration work.

“We have improved legislation in this area. Now we need to take practical steps in this direction. I instruct the Government to develop a geological exploration program by March 1, 2020, taking into account the long-term forecast of demand for mineral resources in the world”, the Head of State said.

According to Kassym-Jomart Tokayev, one of the drivers of economic growth and diversification is the oilfield services industry. The Head of State recommended in this matter to turn to the experience of Norway, where revenues from oilfield services exceeded revenues from hydrocarbon exports.

“By increasing oil and gas production, we have to create a modern oilfield services cluster following the example of Norway. The development of oilfield services will give a significant impetus to the strengthening of domestic SMEs, the creation of jobs, and the localization of industries with high added value”, the President said.

In addition, the Head of State emphasized the importance of the efficient use of natural resources and environmental protection. For this, according to Kassym-Jomart Tokayev, it is necessary to use modern technology, modernize obsolete equipment, reduce emissions, and prevent the leakage of oil and gas. An important priority in this work, the President called increasing the information transparency of oil and gas companies and their environmental responsibility.

During the extended meeting, reports were made by Minister of Energy Kanat Bozumbayev, Minister of Ecology, Geology and Natural Resources Magzum Mirzagaliyev, Chairman of the Management Board of NWF Samruk-Kazyna Akhmetzhan Yessimov, President of the Russian oil and gas company Lukoil Vagit Alekperov, as well as leaders of Tengizchevroil, NCOC and Karachaganak Petroleum Operating companies.

Photo: Akorda’s press office