The Kazakhstan Oil & Gas Downstream Market.
The Kazakhstan Oil & Gas Downstream Market is anticipated to witness a CAGR of approximately 3.78% during the forecast period, rebounding from the negative impacts of COVID-19 in 2020 and reaching pre-pandemic levels. Over the long term, increasing demand for natural gas and substantial investments in refineries are poised to drive market growth. However, challenges persist, particularly concerning the need for better refining equipment due to the high proportion of hydrogen sulfide in Kazakhstan’s natural gas, which could impede market expansion.
Notably, significant crude oil discoveries in southern Kazakhstan in 2021 present opportunities for new refineries to process the crude oil domestically. In this landscape, the oil refining segment is expected to witness significant growth. Kazakhstan, the largest economy in Central Asia, has experienced notable growth in exploration and production activities, with daily refinery throughput reaching 391 thousand barrels in 2021, a 14.33% increase from 2015.
Government initiatives further underscore this growth trajectory, with plans to extend existing oil refineries and invest in new refinery projects. For instance, plans to invest USD 2.9 billion in the Ulytau region include the construction of a new oil refinery in Jezkazgan with a capacity of 1 million tons. Additionally, efforts to expand gas networks and increase access to natural gas across the country contribute to market growth, with the construction of a gas processing plant at the Kashagan oil field and ongoing gas exploration and production projects.
The Kazakhstan Oil & Gas Downstream Market is dominated by key players such as National Company JSC (KazMunayGas), PJSC Lukoil Oil Company, and KazTransOil JSC. Collaborative efforts to explore lower carbon business opportunities, as seen in the memorandum of understanding between Chevron Corp. and JSC NC ‘KazMunayGas’, highlight the industry’s commitment to sustainability and innovation.
Overall, despite challenges and complexities, the Kazakhstan Oil & Gas Downstream Market presents significant growth prospects driven by increasing natural gas consumption, refinery expansions, and strategic collaborations aimed at advancing environmental sustainability within the industry.
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