MINEX Forum

Website: Kazakhstan.com

  • KazMunayGas Invests 68 Billion Tenge in Oilfield Rehabilitation Projects

    KazMunayGas Invests 68 Billion Tenge in Oilfield Rehabilitation Projects

    KazMunayGas, the national oil company of Kazakhstan, has allocated 68 billion tenge towards the rehabilitation of two valuable oil and gas fields, Uzenskoye and Karamanbas. This update was provided by the company’s press center. The project, which began last year, is being implemented by Ozenmunaigas, a major oil enterprise and subsidiary of KazMunayGas.

    This year, the company’s leadership has approved a detailed task list and budget for the ongoing project. Of the total investment, 17 billion tenge was allocated last year, with an additional 51 billion tenge being added this year. The rehabilitation plan includes the deployment of over 200 Electric Submersible Pumps (ESPs), drilling 31 new wells, and undertaking extensive capital repairs of existing wells. Additionally, new methods to enhance oil recovery will be introduced, and a diagnostic and repair hall for underground equipment will be upgraded.

    So far, 23 new wells have already been commissioned, and over 100 have been equipped with modern technology. The project aims to increase oil production by 136,000 tons by the end of the current year, with an overall goal of extracting nearly 19 million tons of additional oil by 2036.

  • New Leader Appointed at Mining and Metallurgical Company

    New Leader Appointed at Mining and Metallurgical Company

    In a recent development, Jeanat Zhanbotin has been appointed as the new head of the mining and metallurgical company. Formerly serving as the Executive Director of Finance, Zhanbotin brings a wealth of experience and expertise to his new role.

    Born in 1980, Jeanat Dusenovich holds degrees in Mining Engineering, Economics and Finance, and a Master’s in Business Administration (MBA). His professional journey commenced in the banking sector, where he climbed the ranks from a specialist to a department head in credit management.

    Since 2007, Zhanbotin has been associated with AO “Vasilkovsky GOK,” a subsidiary of AO Altyntau Kokshetau (a subsidiary of TOO “Kazcink”). By 2021, he had assumed the position of Executive Director of Finance at “Kazcink.”

    Married with four children, Zhanbotin emphasizes his commitment to both his family and his professional responsibilities.

    Speaking on his new role, Zhanbotin acknowledges the dynamic nature of “Kazcink” within the mining and metallurgical sector, highlighting the need to address current challenges posed by global market turbulence and geopolitical uncertainties. He pledges to uphold the company’s legacy of social responsibility while navigating through these complexities.

  • Kazakh Coal Producer “Bogatyr Komir” Maintains Supply Agreement with Russian Company Despite U.S. Sanctions

    Kazakh Coal Producer “Bogatyr Komir” Maintains Supply Agreement with Russian Company Despite U.S. Sanctions

    Despite U.S. sanctions, the agreements between the Kazakh coal producer “Bogatyr Komir” and the Russian coal and energy company SUEK remain intact for regular fuel deliveries, as reported by inbusiness.kz.

    “TOO Bogatyr Komir” is a joint venture between AO Samruk-Energo and Rusal. Concerns had arisen over potential secondary sanctions against the coal mining company due to the inclusion of the Russian buyer, Siberian Coal Energy Company (SUEK), in the U.S. sanctions list.

    Annually, up to 10 million tons of “Bogatyr” fuel were shipped to the affiliated Reftinskaya GRES linked to SUEK.

    According to the “Bogatyr Komir” report, the Kazakh coal producer is operating at full capacity, fulfilling all obligations regarding extraction and export. Between January and April 2024, they extracted and shipped 15,255 thousand tons of coal, with 2,584 thousand tons shipped to Russia. These figures slightly decreased compared to last year, which saw 15,488 thousand tons extracted and 3,343 thousand tons shipped to Russia.

  • ACG-Asia Capital Group Plans Gold Exploration Project in Kazakhstan’s Katon-Karagay District

    ACG-Asia Capital Group Plans Gold Exploration Project in Kazakhstan’s Katon-Karagay District

    TOO “ACG-Asia Capital Group” is gearing up to conduct exploration and assessment work for alluvial gold in the Mayemer area of the Katon-Karagay district in the East Kazakhstan Region. The project documentation from the license holder has been made available for public review on Kazakhstan’s Unified Environmental Portal.

    The commencement of geological exploration is scheduled for May 2024, with completion expected by the autumn of 2026. Specialists aim to evaluate the reserves of the promising area according to categories C1 and C2 and include them in the state balance sheet based on the results of the exploration.

    The licensed area covers 4.54 square kilometers. While targeted exploration for alluvial gold has not previously been conducted within Mayemer, the company notes that based on tailings sampling and general geological indicators, the territory holds promise for identifying deposits. Preliminary estimates suggest prospective resources of 68 kilograms of precious metal under category P2.

    The plan includes conducting mining operations, tailings sampling, collecting large-volume samples, and estimating reserves. A total of 950 samples are set to be collected from all excavations (mining and routes) in the Mayemer area.

  • Kazakhstan Ranks Sixth in Gold Production, Surpassing Previous Year’s Output

    Kazakhstan Ranks Sixth in Gold Production, Surpassing Previous Year’s Output

    Kazakhstan’s gold mining industry witnessed a notable surge last year, with the country extracting 130 tons of gold, propelling it to sixth place in the global ranking of gold-producing nations. This information comes from a report by “Kazinform,” citing data from the United States Geological Survey.

    The recorded gold output of 2023 surpassed the previous year’s production by 15 tons, which stood at around 115 tons. China claimed the top spot in 2023 with 370 tons of gold production, followed by Russia and Australia sharing second and third place, respectively, with 310 tons each.

    Overall, gold miners worldwide extracted 3,000 tons of the precious metal last year, with estimated reserves totaling 59,000 tons. When considering gold reserves, both explored and unexplored, Australia and Russia lead the pack, with reserves of 12,000 and 11,100 tons, respectively.

    The United States Geological Survey assesses Kazakhstan’s gold resources at 1,000 tons. It’s worth noting that earlier, Erlan Akbarov, the Chairman of the Committee of Geology under the Ministry of Ecology, Geology, and Natural Resources of Kazakhstan, stated that the country’s reserves amount to 20,000 tons.

  • Mongolia’s Push for International Bonds Amid Mining Concerns

    Mongolia’s Push for International Bonds Amid Mining Concerns

    Mongolia is actively exploring avenues to raise international bonds in a bid to bolster its economic initiatives, yet investor apprehensions loom large owing to the country’s heavy reliance on mining. With the mining sector constituting a significant portion of Mongolia’s GDP and export earnings, the nation has been a magnet for substantial foreign investments, particularly in copper, coal, and various mineral deposits. However, this reliance on mining exposes Mongolia to inherent risks, exacerbated by frequent government policy shifts, which only serve to deepen uncertainties.

    The recent amendment to Mongolia’s Minerals Law by the parliament has added another layer of concern for investors. The revised law places stringent restrictions on project owners, limiting their ownership to a maximum of 34%, while empowering the government to claim up to 50% of a project without cost. Furthermore, project owners are mandated to divest their remaining stakes to third parties within a year. Such drastic measures have the potential to deter prospective investors and tarnish Mongolia’s image as an attractive investment destination.

    Compounding these worries is the uncertainty surrounding the government’s capacity to honor bond repayments, a recurring issue in the nation’s financial history. Previous commodity price downturns prompted the Ministry of Finance to undergo multiple rounds of bond restructuring, sparking apprehensions among investors about Mongolia’s fiscal sustainability.

    To assuage investor concerns and successfully issue bonds on favorable terms, Mongolia must prioritize reinforcing its legal and economic foundations. While diversifying the economy remains a strategic imperative, sustainable diversification hinges on fostering responsible mining practices. Consequently, supporting the mining industry emerges as a critical necessity. By instituting transparent and predictable regulatory frameworks that instill confidence among investors, Mongolia can harness the full potential of its mining sector while fortifying long-term financial stability. Such measures will lay the groundwork for future development, facilitating diversified growth across diverse economic sectors.

  • Kazakhstan Implements Measures to Address Raw Material Shortage

    Kazakhstan Implements Measures to Address Raw Material Shortage

    The Ministry of Industry and Infrastructure Development of the Republic of Kazakhstan has mandated domestic raw material producers to supply the necessary volumes of products to enterprises in the processing industry. This decision comes in response to the ongoing challenge of raw material shortages faced by Kazakh metallurgists, primarily due to exports. On average, around 87% of primary metals were shipped to other countries, exacerbating the deficit domestically. It is expected that the amendments introduced in May will alleviate this issue, ensuring that domestic industrial enterprises are adequately supplied with raw materials. Additionally, these measures aim to replenish the domestic market with finished products and enhance Kazakhstan’s export potential. By 2029, Kazakhstan intends to increase lead and aluminum processing by four and five times respectively, while copper processing is projected to increase thirteenfold by that time.

  • Prime Minister of Kyrgyzstan Visits Kumtor Gold Mine, Emphasizes Importance of Mining Operations

    Prime Minister of Kyrgyzstan Visits Kumtor Gold Mine, Emphasizes Importance of Mining Operations

    During a working trip to the Issyk-Kul region, Prime Minister and Head of the Presidential Administration of the Kyrgyz Republic, Akylbek Japarov, familiarized himself with the activities of the closed joint-stock company “Kumtor Gold Company.” A meeting was held with the management of the Kumtor enterprise, where Prime Minister Japarov emphasized the crucial importance for the state to ensure uninterrupted and efficient operation of the mine, as well as the fulfillment of all planned objectives. He then visited the machinery workshop of the enterprise to inspect the assembly of new excavators and refueling stations. The project for the automation of oil storage facilities and refueling stations at Kumtor allows for meticulous control over fuel consumption. Currently, over 800 different vehicles, machinery, and equipment are utilized to ensure uninterrupted mining at the site. Prime Minister Japarov also visited the main quarry of Kumtor, where mining operations are in full swing, including the implementation of an underground gold mining project. It’s worth noting that in February of this year, the underground gold mining project at the Kumtor deposit was launched, aiming to extract around 115 tons of gold. During the inspection of the gold mining plant, it was noted that new equipment has been installed, similar to an X-ray machine, enabling proper control of entries and exits from the plant premises. Additionally, it was announced that gold extraction from ore waste located in the mine’s tailings facility is planned to commence in 2026. Preliminary estimates suggest this could yield an additional 120 tons of gold. Furthermore, the 2023 results revealed that 13,567 tons of gold were extracted from the Kumtor deposit, with the company’s total revenue amounting to $848 million USD, and a net profit of $302.5 million USD. Prime Minister Akylbek Japarov, having familiarized himself with the Kumtor mine operations on-site, highlighted significant changes occurring for the state following Kumtor’s transition. Notably, last year, the country’s budget received 17.2 billion soms in taxes, social payments, and other fees, with over 99.9% of the workforce comprising local specialists.

  • Kazakhstan Takes Measures to Enhance Workplace Safety and Reduce Work-Related Injuries

    Kazakhstan Takes Measures to Enhance Workplace Safety and Reduce Work-Related Injuries

    Kazakhstan witnesses over 1400 workplace accidents annually, with more than 200 resulting in fatalities. Among the various sectors of the Kazakhstani economy, the mining and metallurgical complex reports the highest number of casualties at 21.3%, followed by the construction industry at 10%, according to data from the Ministry of Labor and Social Protection cited by inbusiness.kz.

    More than 519,000 workers are employed in hazardous working conditions, with every third worker (37%) exposed to elevated levels of noise and vibration, every fourth worker (25%) operating in areas with increased gas and dust concentrations, and every eighth worker (13%) enduring unfavorable temperature conditions. Additionally, over 107,000 individuals (21%) are engaged in strenuous physical labor.

    In 2023, based on assessment results, 697,000 workers received various compensations for working in hazardous conditions, with employers allocating 255 billion tenge, a 23% increase from the previous year.

    Over the past five years, governmental and employer-initiated measures have contributed to a reduction in the rate of occupational injuries (frequency rate per 1,000 workers) from 0.23 to 0.21.

    Efforts towards ensuring healthy and safe working conditions in Kazakhstan continue with a comprehensive approach. In 2023, law enforcement agencies received 1055 reports on workplace accidents, resulting in 149 criminal cases being initiated.

    To evaluate actual workplace conditions, over 10,000 industrial facilities underwent assessment, while 3214 enterprises across the country implemented safety and labor protection standards to prevent violations.

    Since 2019, Kazakhstan has actively promoted the Vision Zero Concept, aiming for zero accidents. Currently, 536 national enterprises have joined this initiative, with 258 Kazakhstani enterprises adopting a vertical control model to ensure safety standards in subcontracting organizations within the construction sector.

    To further enhance social protection mechanisms for workers employed in hazardous conditions, special social payments were introduced from January 1, 2024, following the president’s directive. Nearly 6,000 workers have transitioned out of hazardous working environments and are receiving these special social payments.

    The Ministry of Labor and Social Protection of the Population of Kazakhstan aims to significantly reduce the number of hazardous workplaces and decrease the level of occupational injuries. Last year, the government approved the Safe Labor Concept until 2030, outlining plans for modernizing the national occupational safety management system, incentivizing measures to reduce professional risks, advancing professional competencies and scientific potential in labor protection, and improving the effectiveness of control and monitoring in the field of labor protection.

  • Deputy Raises Concerns Over Support for Domestic Producers in Kazakhstan

    Deputy Raises Concerns Over Support for Domestic Producers in Kazakhstan

    During a plenary session of the Mazhilis, Deputy Bolatbek Nazhmitdenuly addressed issues regarding supporting businesses through state procurements and purchases from quasi-governmental sectors and subsoil users from domestic manufacturers, as reported by inbusiness.kz.

    He revealed that the total amount of purchases in Kazakhstan currently stands at around 23-24 trillion tenge. Nazhmitdenuly pointed out discrepancies in government data, stating that while the Ministry of Industry and Infrastructure Development claims the state controls nearly 60% of purchases, other sources suggest it may be as low as 20%. He criticized the validity of the ST-KZ certificate and industrial certificate, questioning the effectiveness of government approaches.

    The deputy also sought clarification from officials on the criteria for inclusion in the registry of domestic producers and how to ensure only conscientious producers are listed.

    In response, Minister of Industry and Infrastructure Development Kanat Sharlapayev acknowledged the challenges in distinguishing between counterfeit producers and genuine Kazakhstani enterprises. He highlighted the need for modernization in the selection process and proposed adopting digital methods, drawing parallels with credit checks conducted by banks.

    Sharlapayev emphasized the importance of leveraging available data, suggesting that criteria such as electricity consumption could indicate manufacturing activity. He advocated for the involvement of industry associations in validating producer status and stressed the responsibility of government agencies in managing the registry.

    Furthermore, Sharlapayev outlined the importance of long-term contracts with producers, linking them to commitments for increased localization, improved employee income levels, and production expansion.