Review of the Year 2014
As 2014 draws to a close, we take a look at how the market conditions in Kazakhstan have changed over the year and conduct a review of what this means in terms of opportunities for SMEs looking to export goods and/or services over the year ahead.
Although towards the end of the year, there has been a global dip in oil prices, Kazakhstan continues to be a world leader in oil production and there remain plenty of opportunities for UK companies, as the industry is continuously looking for better ways of extracting and producing oil. If your company has the skills, expertise or technology to come up with new ideas, then the market could well be yours for the taking. Some of the bigger projects in Kazakhstan have seen significant delays and even extremely costly shut downs, which means that new innovation is always being sought after. Kazopp enjoys a well established network of trusted Kazakh companies, which are eager to work with foreign partners. As a result, there is a huge opening for SMEs who are willing to work in partnership with such companies – by doing so, they can often be more competitive than the large western corporations going over there, who have large overheads and therefore charge the highest daily rates. We remain in a strong position, in that if we match the right people together, we can offer more benefit, by being able to offer local content.
Using Kazopp as an intermediary, SMEs who are willing to work with our trusted Kazakh partners in providing innovative solutions are well placed to present a more attractive offer to those looking for the right expertise, including the use of local labour, an aspect which has been high on the Kazakh agenda for some time.
In construction, there are still plenty of projects going on, although there is of course a knock on effect when the oil price goes down. Closer attention is paid to who puts what money into projects, which inevitably slows them down. Here again, Kazakhstan is always looking for innovation and efficiencies in that field and our previous experience and involvement in country means we have contacts in numerous Kazakh companies keen to work with UK companies.
Kazakhstan planned to produce 41 billion cubic metres of gas in 2014, a slight drop on the 42.3 billion cubic metres produced in 2013 but the country remains rich with hydrocarbon reserves. Production comes mainly from five onshore fields – Tengiz, Karachaganak, Aktobe, Mangistau and Uzen, as well as two offshore fields – Kashagan and Kurmangazy, both in the Caspian Sea.
The recoverable oil reserves of Kashagan field are estimated at 11 billion barrels, whereas total geological raw material reserves stand at 35 billion barrels. Besides, natural gas reserves are estimated at over 1 trillion cubic meters.
The Tengiz oil field is one of the deepest and largest oil fields in the world. Reserves of the deposit are estimated at 6-9 billion barrels of recoverable oil.
Karachaganak is also one of the world’s largest fields. Its oil reserves amount to 1.2 billion tons, while those of natural gas are 1.35 trillion cubic meters.
In November, two major electricity supply projects were announced in the Kazakh city of Aktau, as reported by Trend. These involve the construction of high voltage supply lines to ensure the reliability of electricity supplies to the region’s oil and gas fields.
On 1st December, the British Ambassador to Kazakhstan, Carolyn Browne visited Aktau to discuss prospects for British firms in the region in the oil and gas industries and beyond. She cited two factors which highlighted the attraction of Aktau for investment, namely the availability of opportunities for British companies’ development there and the UK’s wealth of experience in the oil and gas industry. Talks also covered the development of tourism, which has been high on the Kazakh agenda this year, although she acknowledged that foreign investors were queuing up [to] share their experience in this area.” (Tengri News)
If you are interested in speaking with us in more detail about the opportunities available in Kazakhstan for UK SMEs, please get in contact.