An open dialogue between the government and oil producing organizations (OPOs) has taken place - Petromining

On February 22, an open dialogue took place between the Vice Minister of Energy of the Republic of Kazakhstan, Akkenzhenov E.K., and representatives of oil producing organizations (OPOs). The event was held at the PetroMining Association site.

The meeting was attended by 72 representatives from 55 OPOs.
The leading agenda of the working meeting comprised issues of a fair market and its regulation in terms of oil and petroleum products.

In particular, during the working meeting, such subjects as export, imbalances in the distribution of profits and taxes in the up to the “gun” chain, transparency in the distribution of supply schedules for oil produced by low-performing oil companies to the domestic market, and the development of statutory regulations, and other important aspects of the industry have been discussed.

The meeting was preceded by a series of preliminary communications with the OPOs. As a result, a pool of challenging issues was formulated.

They were voiced during the report by the Executive Director of the Association, Yaromir Rabay.
“Based on the current situation and challenges, we came up with a number of proposals that can ensure a reduction in government intervention, transparency and competitiveness of the industry. Among them, I would highlight as the key ones, the abolition of direct state regulation of prices on the wholesale and retail markets of petroleum products, the introduction of a mechanism of antimonopoly control over balanced pricing based on the external and domestic markets’ performance, and the provision of equal access by creating regulatory requirements for oil refining and transportation services, and the determination of a minimum share petroleum products subject to mandatory sale through commodity exchanges, indicating the categories of entities that are subject to this obligation, as well as a reduction in the share of government participation in the areas of oil and gas exploration, production, refining; supply of commercial gas, and retail sale of aviation fuel”, — said Yaromir Rabay.
Following the event, the vice minister voiced the position of the Ministry of Energy of the Republic of Kazakhstan and further plans for reforms:
“Today there was a truly open dialogue with oil producing organizations. A lot of questions were raised. I have given detailed explanations. Not a single question was left unattended. The Government is definitely moving towards comprehensive liberalization of the economy and the development of market competition. There is still much work to do, and this work has begun. The Ministry of Energy will continue its open dialogue with the market. The opinions of all parties will be taken into account."
“We had a complex agenda – there is a vision of the market, of our relevant ministry represented by the Ministry of Energy, but along with that, there is also a government policy. We have organized this dialogue to see into the matter, and to discuss all the problematic issues openly, professionally and diplomatically, and, most importantly, to find consensus and hear the opinion and position of the competent authority. We believe that today’s meeting is a good example of the openness of the Government represented by the Ministry of Energy of the Republic of Kazakhstan”, — summarized Sayat Boranbekov, the Head of the Association.
It is also important to note that this initiative, organized by PetroMining and the Ministry of Energy, is a significant step towards an open and trust-based discussion of challenging issues, and the quest for a compromise.

This is definitely a positive sign for the market.