The meeting of the first congress, organized by the PetroMining Association of OPOs of the Republic of Kazakhstan, was attended by 61 oil-producing companies, out of 85 operating OPOs. As a result, several recommendations were offered, which became the basis for the development of the OPO Roadmap.
At the end of September 2023, the PetroMining Association presented a roadmap dedicated to the pressing issues faced by oil-producing organizations, to the Minister of Energy of the Republic of Kazakhstan Almasadam Satkaliev.
Its primary difference and advantage are that for the first time in history, it was formed based on the results of an extensive analysis of the problems and peculiarities of OPOs.
An important achievement was that after the presentation of the OPO Challenge Roadmap, the Minister of Energy instructed to include members of the PetroMining OPOs Association of the Republic of Kazakhstan in the interdepartmental working group to develop the bill concept on legislative amendments in the field of petroleum products circulation. As a result, the first working meetings have already been held by members of the Association on the schedule of oil supplies to the domestic market, and on the access to oil processing at refineries.
Also, the PetroMining OPOs Association of the Republic of Kazakhstan is engaged in the development of two important areas - the Tax Code in terms of the functioning of non-profit organizations and the Concept on the circulation of oil and petroleum products.
Moreover, one of the important positive moments following the results of the first 9 months of the Association’s operation was the unification of more than 40 OPOs. This will provide the opportunity to introduce collective expertise towards the development and support of the industry.
Thus, on February 22, an open dialogue took place between the Vice Minister of Energy of the Republic of Kazakhstan, E.K. Akkenzhenov and representatives of oil-producing organizations (OPOs). The event took place at the site of the PetroMining Association. The meeting was attended by 72 representatives from 55 OPOs. The leading agenda of the working meeting included the issues of a fair market and its regulation in terms of oil and petroleum products. This initiative became a significant step towards an open and trust-based discussion of problematic issues and the search for compromise solutions.
ANALYTICAL IMPUT
While working under the leadership of Jaromir Rabai, the Association’s experts prepared an analysis “Differentiated (unfair) approach to taxation and regulation of budget-forming sectors of the economy,” which presented the tax burden by industry, as well as the key features of the tax and economic burden on hydrocarbons compared to other sectors . Thus, according to the Association, the annual tax burden of private individuals for 2021-2022 increased by 12.6% from 51.5 to 64.1%. This indicator is the highest among other industries, and is one of the key factors reducing the investment attractiveness of the oil industry.
In addition, the Association of NDOs of the Republic of Kazakhstan PetroMining prepared a “Certificate on the analysis of the tax burden as part of the change in the tax regime (new Tax Code of the Republic of Kazakhstan)”, where they presented the change in the tax burden coefficient of NDOs. According to experts from the Association, the new taxation option requires equalization of netbacks (Sales price minus the cost of delivery to the buyer). As a result, the key part for the tax maneuver should be the absence of a difference between oil exports and sales to Kazakhstani refineries.
PARTNERS AND MEMORANDA
An important aspect of the Association’s work was the establishment of partnerships and the development of long-term relations with other players in the Kazakhstani market. As a result of its partnership efforts, the Association has signed memoranda of understanding and cooperation with several key organizations.
Moreover, the Executive Director, Yaromir Rabay, and head of the Association, Sayat Boranbekov interviewed the discoverer of the well-known Kashagan field, Doctor of Geological and Mineralogical Sciences, winner of the Al-Farabi state prize in science and technology, Baltabek Mukhanovich Kuandykov, President of Meridian Petroleum, who shared his thoughts and suggestions on the development of the oil industry.
PARTNERS AND MEMORANDA
The PetroMining OPOs Association of the Republic of Kazakhstan not only actively tried to interact at the political level, but also strived for the openness of its members to the community. As a result, the “ON WATCH” program was launched to show the real conditions and special aspects of working in the fields and to share experience and knowledge with a wide audience.
In the first episode of the program, the head of the Association, Sayat Boranbekov, visited the Khairkeldy field of the KAZPETROL GROUP company, and in the second episode, he went to the Sazankurak enterprise, which is located in the Isatay district.
Furthermore, the Executive Director Yaromir Rabay, and the head of the Association, Sayat Boranbekov, interviewed the discoverer of the well-known Kashagan field, Doctor of Geological and Mineralogical Sciences, the winner of the Al-Farabi State Prize in science and technology, Baltabek Mukhanovich Kuandykov, President of Meridian Petroleum, who shared his thoughts and suggestions on the development of the oil industry.