On March 28, 2025, AO NK KazMunayGas (KMG) announced its consideration of transferring shares in the Atyrau Oil Refinery (ANPZ) and Pavlodar Petrochemical Plant (PNHZ) to the Russian company Tatneft. This move is part of a broader proposal from the Agency for Protection and Development of Competition in Kazakhstan, aimed at fostering competition in the oil refining sector and the petroleum products market by reducing the quasi-state sector's influence.
The KMG press service stated that the privatization of these shares is a significant decision that necessitates extensive analysis and preparation. "The preparation for such decisions requires significant time, both at the level of corporate decisions and from the point of view of technical and economic aspects. In practice, such processes take several years," the company noted.
KazMunayGas is actively developing the petrochemical industry in Kazakhstan and is open to collaborating with various partners for the joint construction of the entire production chain. This includes exploring opportunities with companies from both near and far abroad, including PJSC Tatneft.
In its commentary, KMG highlighted the ongoing exchange of experience with Tatneft, particularly regarding individual installations and technologies, as well as the organization of production for high-value products based on petrochemical raw materials from ANPZ. The company emphasized that Tatneft has achieved significant operational efficiency in producing high-value petrochemical products.
PJSC Tatneft has expressed a keen interest in investing in new petrochemical projects directly associated with ANPZ's production activities, specifically in producing terephthalic acid and polyethylene terephthalate (TFA and PETF). This interest aligns with KMG’s strategy to enhance the operational capabilities of Kazakhstan's oil refineries.
According to KMG, all three of Kazakhstan's oil refineries have shown positive trends. The average yield of light petroleum products has increased from 70% in 2020 to 74% in 2024, and further to 76% in the first quarter of 2025. Additionally, the depth of processing has risen from 85% in 2020 to 88.6% at the beginning of 2025.
In 2024, a total of 17.44 million tons of oil were processed at Kazakhstan's refineries, including SP CASPI BITUM LLP. To ensure the domestic market's needs, KMG has increased the production of light petroleum products by 370,000 tons compared to 2023.
On March 26, prior to KMG's announcement, KazTAG had sent a request regarding the situation at ANPZ but received no immediate response. Instead, KMG opted to publish its comments two days later through its Telegram channel, indicating a strategic communication approach.
Discussion surrounding the potential privatization of shares in ANPZ and PNHZ has been ongoing. Rustam Akhmetov, the first deputy chairman of the Agency for Protection and Development of Competition, mentioned on March 17 that there had been preliminary discussions within the government, where a consensus was reached to transfer 50% of the state’s stake in these assets.
Akhmetov referenced the Shymkent refinery, where a private entity holds a 50% stake, resulting in fewer accidents and technological disruptions, as well as lower repair volumes. This example has fueled discussions on the benefits of privatization in enhancing operational efficiency.
KMG currently owns 100% of PNHZ, 99.53% of ANPZ, and 49.72% of the Shymkent refinery, which is co-owned by the Chinese company CNPC. The dynamics of these ownership structures are crucial as Kazakhstan navigates its energy sector's future.
As the conversation around privatization progresses, the implications for Kazakhstan's energy landscape could be significant. The engagement with Tatneft and other potential investors may lead to enhanced operational efficiencies and technological advancements in the domestic petrochemical industry.
With KMG's proactive stance on partnerships and investments, the future of Kazakhstan's oil refining sector appears poised for transformation. The impending decisions regarding privatization could set a precedent for how the country approaches foreign investments in its vital energy resources.
