EY - Kazakhstan oil and gas tax guide 2014

Kazakhstan oil and gas tax guide 2014

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The oil and gas industry of Kazakhstan plays an important role in the economic development of the republic. It is one of the main drivers of gross domestic product (GDP) growth and an important source of national budget revenue.

EY - Kazakhstan oil and gas tax guide, 2014

According to the latest GDP forecast by the Ministry of Economy and Budget Planning of Kazakhstan in 2013, the average annual growth from 2014 to 2018 will be 6.5%. The oil and gas industry, whose share in total GDP increased from 10.9% in 2001 to 25.2% in 2012, plays a vital role in Kazakhstan’s GDP structure.

Consistent development of the oil and FDI in Kazakhstan 2005–12 gas industry would not be possible without foreign direct investment (FDI). The annual volume of FDI has been increasing year by year since 1998 and the share of investments in the oil and gas industry in total volume of FDI remains high.

According to BP’s Statistical Review of World Energy June 2013, Kazakhstan has proven reserves estimated at 30.0 billion barrels (3.9 billion tons) of oil and proven natural gas reserves of 45.7 trillion cubic feet (1.3 trillion cubic meters), which represent 1.8% and 0.7% of total global reserves, respectively.

Kazakhstan is the second largest oil producer among the former Soviet republics after Russia and is heavily reliant on oil export revenues. Total production of oil and gas condensate in 2013 amounted to 81.8 million tons, up 3.2% year-on-year, of which 72.1 million tons, up 5.1% yearon- year, were exported. The government expects total production to rise to 90 million tons in 2015 and 110 million tons in 2018.

According to the International Energy Agency’s World Energy Outlook 2010, by 2020 Kazakhstan will join the top 10 oil and gas exporters.

State participation in the oil and gas industry has increased over the last several years due to the vital role of this industry in the economy of the republic. The company controls 20% of total oil and gas proved reserves of Kazakhstan and produces 27% of total oil and gas condensate and 14% of gas.