Who Really Profits From Kazakhstan’s Oil?

While Kazakh citizens debate the exchange rate of the tenge and the price of gasoline, the real flow beneath our feet is no longer oil but money. And it isn’t flowing into the National Fund — it’s flowing into the pockets of Western giants. This view comes from oil and gas analyst Olzhas Baidildinov, reports Orda.kz.

Chevron, ExxonMobil, Shell, Total, ENI — the list sounds like the world’s top corporations, but in reality it’s the list of those who know best how to profit from Kazakhstan. According to Baidildinov, who analyzed data from Rystad Energy:

Over just five years, American companies Chevron and ExxonMobil will receive free cash flow, or earn, 28 billion dollars and 14 billion dollars from Tengiz, respectively. Taking into account Lukoil’s share, roughly 45 billion dollars will potentially ‘flow out’ of Kazakhstan from Tengiz alone over the next five years. And the contract, I remind you, runs until 2033.

Tengiz is the third-largest international project in the world for ExxonMobil, and for Chevron it is the largest and most profitable globally,Baidildinov notes. 

Kashagan

But Tengiz is not the only source of cash flowing out of Kazakhstan. Baidildinov also points to Kashagan — another “golden” project that essentially works for foreign companies:

France’s Total, Italy’s ENI, Britain’s Shell, and America’s ExxonMobil will each receive around five billion dollars from Kashagan by 2030. In total, foreign shareholders will take more than 25 billion dollars from Kashagan in just five years. The PSA for Kashagan is valid until 2041.

Baidildinov stresses that for Britain’s Shell, the Kashagan and Karachaganak fields are among the company’s most important and profitable global projects, ranking third and fifth.

For France’s Total, Kashagan is its top project worldwide, while for Italy’s ENI, Kashagan and Karachaganak hold first and second place in its international portfolio.

A Rhetorical Question

If oil begins to run out within the next five years, what will Kazakhstan have left beyond glossy reports from foreign corporations?

It’s easy to mock Baidildinov if you lack the brains to ask the truly important questions for the country’s economy — questions about the need to revise PSAs and stabilized contracts. It’s important to understand that oil will begin running out within the next five years,the expert concludes. 

Original Author: Alina Pak