Chinese companies to control over 40% of Kazakhstan’s oil shortly

The share of Chinese companies in the Kazakhstan’s Oil and Gas industry will exceed 40% in 2013, KazTag reports, citing an unidentified source.

 “According to some estimates, Chinese companies will have gained control of over 40% of Kazakhstan’s oil by the fall 2013 which means that in future the Chinese will be responsible for production of over 40% of all the crude in Kazakhstan”, the source said.

 “After KazMunaiGas EP acquires stakes in Kazakhoil Aktobe, Kazakhturkmunai and Mangistau Investments B.V. from KazMunaiGas, the China’s share will grow substantially China Investment Corporation and its controlled companies already own 30% in KazMunaiGas EP”, the source stressed.

 According to the source, “China’s share in Kazakhstan’s oil is bigger than that of Kazakhstan: it exceeds 30 million tons and is set to grow”.

 “Specialists and respective public bodies are fully aware of the situation, but try to not have the facts widely covered in the media. After a large-scaled protest against alleged plans to lease out some Kazakh lands to the Chinese, the authorities try to downplay the oil issue (…) therefore all the estimates and assessments of the China’s share in Kazakh oil are complicated”.

 “It is quite hard to estimate the share of any player of the O&G market as there are a lot of intermediary companies outside Kazakhstan (…) I mean offshore zones and tax havens. These companies are in the name of front men, relatives sometimes. Nevertheless, respective ministry does know who owns a certain offshore company”, the source believes.

 “Chinese businessmen do not hurry to export most of the Kazakh crude to their homeland. There are a number of reasons for that. It is no secret that Chinese managers in Kazakhstan are relatives of the Party bosses, of top and middle-level governmental officials and they don’t feel shy when making money for their family clans. Grey schemes and seemingly inconspicuous diversity of Chinese companies in Kazakhstan enable to have off-the-books, hidden reserves to produce and sell crude(…) and, what is more important, to have them shipped to Europe directly from our country”, the source said.

Tengrinews.kz