Today, at Gazprom’s Headquarters, Alexey Miller, Gazprom’s Management Committee Chairman, held a working meeting with Vladimir Shkolnik, Energy and Mineral Resources Minister of the Republic of Kazakhstan. The parties discussed cooperation in the gas industry.

Kazakhstan plans to significantly boost its natural gas production in the next few years. In order to achieve this goal, the parties will need to coordinate activities and synchronize operations in expanding the capacities of the Central Asia – Center gas pipeline, given the soaring Russian gas acquisitions in Turkmenistan and Uzbekistan.

A. Miller and V. Shkolnik examined the prospect of bilateral cooperation due to the development of the Kashagan, Karachaganakskoye and Tengizskoye fields.

The parties also discussed the prospect for concluding long-term agreements on the Kazakh gas purchases from the Karachaganakskoye gas condensate field, which would increase the capacities of the Orenburgskoye UGS facility up to 15 bcm of gas and 6 million tons of gas condensate per annum.

Reference:

The explored natural gas reserves of the Republic of Kazakhstan average 2 tcm, while the forecasted natural gas resources, the Caspian Sea shelf, inclusive, are estimated at 8.3 tcm.

The Kazakh annual gas production has lately averaged 11-12 bcm, while domestic gas consumption accounts for some 5 bcm per year. Kazakhstan plans to build up its gas production up to 14 bcm in 2005 and to 40 bcm in 2020.

The Russian-Kazakh cooperation in the gas industry is governed by the following Intergovernmental Agreements on: Cooperation and Development of Fuel and Energy Complexes, dated 25 December 1993 (plus annual Protocols to the Agreement); Technical and Economic Cooperation and Integration in the Oil and Gas Industries, dated 25 February 1997; Cooperation in the Gas Industry, dated 28 November 2001.

In June 2002, Gazprom and the KazMunaiGaz National Company set up on a par and registered the Kazakhstan-based KazRosGaz joint venture with the view of natural gas purchases and marketing, gas processing at Russian gas distribution plants and other types of activities.

Main directions of cooperation between Gazprom and Kazakhstan are:

• Feedstock (from the Karachaganakskoye gas condensate field) processing at the Orenburg gas distribution plant. In 2003 the Orenburg gas distribution plant processed some 5.5 bcm of raw gas and 4.5 million tons of unstable gas condensate. The 2004 plan envisages 7 bcm and 3.1 million tons, respectively.
• The Gazprom Group’s services on the Kazakh gas transit, piped from the Tengizskoye field via the Russian Federation to the Caucuses region.
• Russian natural gas deliveries to the consumers of Kazakhstan’s Kustanai region.
• Central Asian gas transit via the Republic of Kazakhstan in growing amounts pursuant to the long-term agreements concluded.

DIVISION OF RELATIONS WITH MASS MEDIA