In a recent move, Kazakhstan has gone on to invite energy companies as well as investors so as to bid on more than 50 oil and gas fields and also prospective blocks across the country, thereby hoping for a largely successful run when it comes to finding new operators for the state-held resources.
As per a statement from the energy ministry of Kazakhstan, the offered asset list includes 11 existing fields as well as 45 prospective acreages in which more efforts will have to be put up so as to pinpoint hydrocarbon reserves that are commercially viable. The identified fields happen to be small assets that are located primarily in the country’s two oil provinces of Atyrau and Mangistau. They are expected to raise interest in privately owned domestic setups that are already operational in those areas.
Before, online auctions used to attract only investors based out of Kazakhstan; however, the Chinese operators who are already based in the country have gone on to show immense interest. With this new development, the ministry also looks out to see if large foreign companies are actually willing to be a part of this long-term investment when it comes to the exploration drive before any commercial discoveries are made.
Notably, the acreage on offer has in it seven large blocks that exist from 1800 to 5500 square kilometres across the Ustyurt Plateau, which is a desert that spans southwest Uzbekistan and southeast Kazakhstan.
Apparently, six of the Ustyurt blocks were already on offer in March last year; however, they failed to draw any foreign commitments after Russia’s war in Ukraine led to a spike in the risk profile of Kazakhstan.
Almost 90% of Kazakh oil exports transit via Russia; however, the country has now announced a commitment to go ahead with varied export routes. The Ustyurt Plateau consists of the Aral Sea, which has almost dried up in the last 50 years. This area is thought to have deposits of commercial hydrocarbon resources. As per the ministry, the two areas, Aral North and Aral South, totaling 9600 square kilometres, are up for grabs.
Apart from the Ustyurt and Aral areas, the authorities are also hoping to auction numerous other big, unexplored blocks located in the Aktyubinsk and Atyrau regions that happen to be near the present oil fields.
All that investors have to do is fill out an application in order to participate in the online auction. These applications can be filed through Gosreesrt, the state auction operator; however, there aren’t any deadlines shared by the ministry as of yet.
Once the received applications are reviewed by the authorities, an auction date shall be announced, and thereafter more information on blocks along with exploration commitments will be shared.
This information, upon receiving it, shall help the investors decide whether they would like to go ahead with the auction participation, and if they agree, a non-refundable deposit will have to be made.