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In recent months, the Kazakhstan government, in conjunction with KazMunaiGas, has committed to retooling its three oil refineries in Atyray, Pavlodar and Shymkent. The goal is to produce fuel to the new Euro-5 standard of 10 parts of sulfur per million, and to have production plants that easily adapt to the production of diesel and jet fuels, as well.
According to Serik Baimukhambetov, KMG Managing Director of Safety, Health and Environment, “it is more advantageous for us to export high-quality petroleum products” than it is to export the crude oil. Modernization of the oil and gas industry is one of several priority sectors that the Kazakhstan Democracy is focusing its economic attention.
In order to entice investors in these sectors, the Kazakhstan government offers a number of incentives, including:
- Corporate tax preference for up to 10 years
- Reduced property and land tax rates for up to five years
- Exempting new equipment and other supplies used to start up a new investment project from custom duties.
- Access to in-kind public grants.
In 2009, 59 percent of Kazakhstan’s exports were from the oil and gas industry. Profits from the nation’s oil and gas industry have nearly doubled between 2006 and 2010 according to the KMGEP website.
The three major credit rating agencies — Standard & Poor’s, Moody’s and Fitch — have rated the Kazakhstan’s economy as stable, stable and positive, respectively. As a political and economic leader in Central Asia, Kazakhstan continues to surprise and impress the global marketplace. Its commitment to raising production standards to meet the environmental needs of the West positions it to increase its market position.
