New Opportunities for Producers and Service

Companies in Major Oil-Gas Projects in Kazakhstan

SERVICESSERVICESOIL – GASOIL – GAS ASSOCIATIONASSOCIATION

October 5, 2012October 5, 2012

• Major projects of KazakhstanMajor projects of Kazakhstan• Offshore projectsOffshore projects• KMG GroupKMG Group• Junior oil companiesJunior oil companies• New pipelinesNew pipelines• Mining and industrial projectsMining and industrial projects• About the UnionAbout the Union

VISION

MISSIONVALUES

OutlineOutline

Kazakh services market can be dividedKazakh services market can be divided

By technological complexity: By technological complexity: • High technological works – top international High technological works – top international

companies;companies;• Middle-technological works – JVs, foreign and Middle-technological works – JVs, foreign and

top local companies; top local companies; • Low-technological works – mostly local Low-technological works – mostly local

companies.companies.

By ClientsBy Clients• Majors; Majors; • Junior oil companies; Junior oil companies; • State and affiliated industries: State and affiliated industries: • Downstream and Industrial projectsDownstream and Industrial projects

Service industry Service industry

More than 50% of all procurementMore than 50% of all procurement::

Current and ongoing projects:TCO, KPO, НСОС.

Shut-down projects:TCO, KPO, НСОС.

Expansion projects:TCO – FGPНСОС – Kashagan, FFDPКPО – Third phase

Majors Majors

Large development stage in next decadeLarge development stage in next decade::

Kazakh side of Caspian Sea is under large exploration works.In next 5-8 years it is expected following projects development stage:7 projects:• Kurmangazu• Tyub-Karagan• Zhemchuzhina (Pearl)• Zhambai• Block N• Zhambyl• Satpaev

- «We calculated that in order to get 250 millions tones of oil at Satpaev, 9 billiion should be spent (drilling and capital expences included), - Kairgeldi Kabyldin, ex-CEO of KMG. (www.kmg.kz)

Offshore projectsOffshore projects

KMG GroupKMG Group

Kazmunaigaz Group of Companies is one of the largest consumers of services works and machinery products. Some companies to mention: • KMG EP• Mangystaumunaigaz• Kazakhoil-Aktobe• PetroKazakhstan• Kazgermunau• etc

More detailed information: www.kmg.kz

State companiesState companies

New projects which will start in next 2-5 yearsNew projects which will start in next 2-5 years

Gas-Turbine Electricity Station in West-Kazakhstan region

New Gas PlantIt is expected that this new plant will work for KPO gas, with capacity of 5 billion cubic meters of gas per year. The plant will be built near to Karachaganak gas field in West Kazakhstan region.

Ship building and ship repairing plant in Kuryk Village in Mangystau region

Pavlodar Refinery project

Works for gas utilization projects in Kazakhstan

Geo-exploration of several blocks

Projects of KMG Special Company Projects of KMG Special Company (Directorate of new enterprise)(Directorate of new enterprise)

8

Refineries modernization Refineries modernization ((Source: KMGSource: KMG) )

NameName Budget, Budget, mln. $ mln. $ DeadlineDeadline Стадия реализации Стадия реализации

1. 1. Atyrau Atyrau 2 2 668668 20152015   

Construction of complex for Construction of complex for aromatic fuel productionaromatic fuel production 1 1301 130 20132013 StartedStarted

Construction works for increasing Construction works for increasing the complexity of fuel (according the complexity of fuel (according Euro 5 standards)Euro 5 standards)

1 1 538538 20152015 StartedStarted

2. 2. ShymkentShymkent 1 1991 199 20152015 Engineering is being startedEngineering is being started

           

3. 3. Pavlodar Pavlodar 1 9001 900 20152015 Engineering is being startedEngineering is being started

           

4. 4. Bitumen plantBitumen plant 290290 20122012 Late construction phaseLate construction phase

Independent oil-gas companies – still large marketIndependent oil-gas companies – still large market

• CNPC-Aktobemunaigas, • Zhaikmunai• Buzachi• Karakuduk• Sagiz Petroleum Company• Kommunai• SautsOil• Arman JV• Tasbulat• Max Petroleum• Samek Internation • OMV Group • Maersk • Etc

More detailed information about the procurement in these companies: www.camng.kz

Junior oil companiesJunior oil companies

Export and domestic pipelinesExport and domestic pipelines::

Gas pipelines Gas pipelines constructionconstruction

Asian gas pipelineAsian gas pipeline, , the 3 linethe 3 line, , engineering works engineering works completed, maybe the construction will start in 2012 completed, maybe the construction will start in 2012

Beineu-BozoiBeineu-BozoiConstruction of 1 phase (Bozoi-Shymkent line) with capacity of 6 billion cubic meters of gas per year Construction of 2 phase (Beineu-Bozoiline) with capacity increase up to 10 billion cubic meters of gas per year

Expected budget: around 2,5 billions USD

North and Central Kazakhstan gasification projects North and Central Kazakhstan gasification projects

CPC capacity increase project CPC capacity increase project

Project of Pri-Caspian gas pipeline (?)

Industrial and mining projects – good perspectiveIndustrial and mining projects – good perspective

Other projectsOther projects

Kazakhstan petrochemical project Kazakhstan petrochemical project in Atyrau region with in Atyrau region with budget of more than 6,3 billions USDbudget of more than 6,3 billions USD

Energy SectorEnergy SectorPower plant station reconstructionPower plant station reconstructionConstruction of new power plants in Balhash, Astana, Construction of new power plants in Balhash, Astana, Karagandy, etcKaragandy, etc

Mining sectorMining sectorKazakhmysKazakhmys: : Bozshakol, AktogaiBozshakol, AktogaiENRC projectsENRC projectsJunior mining companies projectsJunior mining companies projects

Some areas in service marketSome areas in service market

• Construction (ЕРС)• Offshore fire systems• Oil spill systems• Offshore drilling• Offshore piping• Offshore welding • Fabrication • Dredging works• Ship repaor• Engineering (second-tier)• Marine transportation• SCADA systems• Waste management• Niche Works – E&I, Heavy lifting, different types of

inspection and repair of equipment, equipment rental.

OpportunitiesOpportunities

Union of Service Companies of Kazakhstan

About UnionAbout Union

• Assistance to the Association members in tenders process;

• Participation in decision-making process;

• Organization the different type of activities;

• Assistance in local content increase via JV, consortium creation;

• Competence Centre for oil-gas service industry – one stop shop.

• Consolidation of all service companies in oil-gas industry in one Association

Our visionOur vision

VISION

MISSIONVALUES

VISION

VALUES

MISSION

GoalsGoals

Kazneftegazservice–2013 ConferenceKazneftegazservice–2013 Conference

For discussion of service industry issues and large projects on 14-15 February 2013 the Union is organizing the second Conference Kazneftegazservice- 2013 in Astana. It is expected participation of many service companies and producers in this event.

At the same time, in same building, the Ministry of Oil and Gas is holding the Forum of oil-gas companies: Local Content – 2013, where it is expected the participation of all oil-gas companies of Kazakhstan with their procurement plan for short and medium term.

More information: www.kazneftegazservice.com

ConferencesConferences

Thanks for your attentionThanks for your attention!!

Our contactsOur contacts

Union of Service Companies of KazakhstanUnion of Service Companies of Kazakhstan

AddressAddress:: AstanaAstanaSyganak street, Syganak street, 2929OfficeOffice 1113 1113

TelTel: : +7 7172 51 69 68+7 7172 51 69 68FaxFax: : +7 7172 51 69 68+7 7172 51 69 68

Web:Web: www.kazservice.kzwww.kazservice.kz

Email:Email: info@kazservice.kz info@kazservice.kz