PetroMining Association held its first congress
Over 70% of private OPOs gathered for the first time in Kazakhstan to discuss common problematic issues.
The first congress of independent oil-producing and refining enterprises of Kazakhstan brought together 61 companies out of 85 active OPOs. Many participants noted that it was the first time in their 30-year careers that they had attended such an event.
The Executive Director of the PetroMining Association Jaromir Rabai announced that for the last 5 years, there was a 17% drop in production volumes by OPOs. And the state has received 255.4 billion tenge of tax payments and fees, and the companies have lost 181.5 billion tenge of profit in 2022 due to the greater share of oil supplies to the domestic market.
Sayat Boranbekov, the Head of the PetroMining Association, noted that companies and the Association are committed to having an open dialogue with the government and being of help in analytics to find joint solutions. After all, OPOs represent more than 43,000 employees and 2.4 trillion tenge in tax revenues for 2020-2022.
The first congress of independent oil-producing and refining enterprises of Kazakhstan brought together 61 companies out of 85 active OPOs. Many participants noted that it was the first time in their 30-year careers that they had attended such an event.
The Executive Director of the PetroMining Association Jaromir Rabai announced that for the last 5 years, there was a 17% drop in production volumes by OPOs. And the state has received 255.4 billion tenge of tax payments and fees, and the companies have lost 181.5 billion tenge of profit in 2022 due to the greater share of oil supplies to the domestic market.
Sayat Boranbekov, the Head of the PetroMining Association, noted that companies and the Association are committed to having an open dialogue with the government and being of help in analytics to find joint solutions. After all, OPOs represent more than 43,000 employees and 2.4 trillion tenge in tax revenues for 2020-2022.
"It is important to de-regulate the market, to remove controlled sales by petrol stations and agricultural consumers. It turns out that we, business, are subsidizing other people's business. At the same time, we have the highest taxes in the industry: the tax burden is about 53%. De-regulation will equalize a lot of things," said one of the congress participants, who was unequivocally supported by all those present.
Numerous cases were mentioned of how long the processes of approval and environmental expertise of basic and technical projects take, with companies losing 1-2 years on formal procedures. In the conditions of the Brownian motion in the global oil market, it is a waste of precious time. Yet, all companies stand on the principle of environmental protection.
Lack of quality oil and gas equipment, deficiencies in transfer pricing legislation, which provides for world prices as a basis for taxation, transparent mechanisms and rules for quota allocation when approving oil transportation schedules, mineral extraction tax rates at the exploration stage, legal vulnerability of private investors — all these and other questions were raised by the private OPOs.
Lack of quality oil and gas equipment, deficiencies in transfer pricing legislation, which provides for world prices as a basis for taxation, transparent mechanisms and rules for quota allocation when approving oil transportation schedules, mineral extraction tax rates at the exploration stage, legal vulnerability of private investors — all these and other questions were raised by the private OPOs.
"Today, we, OPOs, are all on equal terms. Not very good terms. It is important for us to jointly form a common view. There are a lot of double standards in our economy, but there should not be any in the Association," declared one of the first members of the Association.
In closing the event Sayat Boranbekov, the Head of the PetroMining Association, concluded: "Our main task is to be a bridge between OPOs and our colleagues in the government. Following today's congress, our fellow colleagues from OPOs provided a high credit of trust". He also noted that joining the Association is free of charge, does not impose additional obligations on those joining and is formalized as simply and quickly as possible.
The Association's next steps will be to analyze all opinions and insights heard from market participants, form a roadmap and have it approved by colleagues from the OPOs for further implementation.
For more details, please contact:
https://t.me/PetroMining
a@petromining.kz
The Association's next steps will be to analyze all opinions and insights heard from market participants, form a roadmap and have it approved by colleagues from the OPOs for further implementation.
For more details, please contact:
https://t.me/PetroMining
a@petromining.kz
05.08.2023